Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Mar. 25, 2015 | Jun. 30, 2014 | |
Entity Information [Line Items] | |||
Document Type | 10-K | ||
Amendment Flag | FALSE | ||
Document Period End Date | 31-Dec-14 | ||
Document Fiscal Year Focus | 2014 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | FOUR OAKS FINCORP INC | ||
Entity Central Index Key | 1040799 | ||
Current Fiscal Year End Date | -19 | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Common Stock, Shares Outstanding | 32,042,883 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $9,633,150 |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
ASSETS | ||
Cash and due from banks | $15,519 | $11,890 |
Interest-earning deposits | 143,008 | 116,739 |
Cash and cash equivalents | 158,527 | 128,629 |
Certificates of deposit | 27,784 | 31,850 |
Investment securities available-for-sale, at fair value | 64,211 | 32,566 |
Investment securities held-to-maturity, at amortized cost | 81,583 | 98,013 |
Total investment securities | 145,794 | 130,579 |
Loans held for sale | 2,882 | 0 |
Loans | 452,256 | 492,712 |
Allowance for loan losses | -9,377 | -11,590 |
Net loans | 442,879 | 481,122 |
Accrued interest receivable | 1,627 | 1,576 |
Bank premises and equipment, net | 11,895 | 12,571 |
FHLB stock | 4,788 | 6,076 |
Investment in life insurance | 14,590 | 14,380 |
Foreclosed assets | 3,782 | 8,502 |
Other assets | 6,248 | 6,261 |
TOTAL ASSETS | 820,796 | 821,546 |
LIABILITIES AND SHAREHOLDERS' EQUITY | ||
Noninterest-bearing demand | 251,723 | 228,203 |
Money market, NOW accounts and savings accounts | 175,731 | 166,102 |
Time deposits, $100,000 and over | 143,336 | 162,403 |
Other time deposits | 90,395 | 100,912 |
Total deposits | 661,185 | 657,620 |
Borrowings | 90,000 | 112,000 |
Subordinated debentures | 12,372 | 12,372 |
Subordinated promissory notes | 12,000 | 12,000 |
Accrued interest payable | 1,704 | 1,642 |
Other liabilities | 2,806 | 4,289 |
TOTAL LIABILITIES | 780,067 | 799,923 |
Commitments and Contingencies (Note D, L, O, and P)) | ||
Common stock, $1.00 par value, 80,000,000 shares authorized; 32,032,327 and 7,977,658 shares issued and outstanding at December 31, 2014 and 2013, respectively | 32,032 | 7,978 |
Additional paid-in capital | 32,520 | 34,269 |
Accumulated deficit | -24,579 | -20,390 |
Accumulated other comprehensive income (loss) | 756 | -234 |
Total shareholders' equity | 40,729 | 21,623 |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $820,796 | $821,546 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Stockholders' Equity: | ||
Common stock, par value (in usd per share) | $1 | $1 |
Common stock, shares authorized | 80,000,000 | 80,000,000 |
Common stock, shares issued | 32,032,327 | 7,977,658 |
Common stock, shares outstanding | 32,032,327 | 7,977,658 |
CONSOLIDATED_STATEMENTS_OF_OPE
CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 12 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Interest and dividend income: | ||
Loans, including fees | $25,331 | $26,619 |
Taxable investments | 2,401 | 1,419 |
Dividends | 326 | 322 |
Interest-earning deposits | 747 | 686 |
Total interest and dividend income | 28,805 | 29,046 |
Interest expense: | ||
Deposits | 2,872 | 3,482 |
Borrowings | 3,997 | 4,065 |
Subordinated debentures | 199 | 204 |
Subordinated promissory notes | 1,020 | 1,020 |
Total interest expense | 8,088 | 8,771 |
Net interest income | 20,717 | 20,275 |
Provision for loan losses | 7,954 | 35 |
Net interest income after provision for loan losses | 12,763 | 20,240 |
Non-interest income: | ||
Service charges on deposit accounts | 1,672 | 1,744 |
Other service charges, commissions and fees | 3,442 | 3,951 |
Gains on sale of investment securities available-for-sale, net | 265 | 462 |
Gains on sale of nonmarketable investment securities, net | 298 | 0 |
Gains on sale of loans held for sale | 1,150 | 0 |
Income from investment in life insurance | 210 | 241 |
Indemnification from third party payment processor clients | 3,872 | 0 |
Other non-interest income | 205 | 825 |
Total non-interest income | 11,114 | 7,223 |
Non-interest expenses: | ||
Salaries | 9,306 | 9,456 |
Employee benefits | 1,748 | 1,813 |
Occupancy expenses | 1,311 | 1,196 |
Equipment expenses | 1,134 | 1,422 |
Professional and consulting fees | 3,419 | 3,095 |
FDIC assessments | 1,835 | 1,737 |
Foreclosed asset-related costs, net | 1,931 | 2,219 |
Collection expenses | 630 | 839 |
Prepayment of FHLB borrowings | 1,487 | 0 |
Other operating expenses | 5,265 | 6,036 |
Total non-interest expenses | 28,066 | 27,813 |
Loss before income taxes | -4,189 | -350 |
Income tax benefit | 0 | 0 |
Net loss | ($4,189) | ($350) |
Basic net loss per common share (in usd per share) | ($0.24) | ($0.04) |
Diluted net loss per common share (in usd per share) | ($0.24) | ($0.04) |
CONSOLIDATED_STATEMENTS_OF_COM
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Net loss | ($4,189) | ($350) |
Other comprehensive loss: | ||
Unrealized holding gains (losses) on available-for-sale securities | 1,348 | -1,027 |
Tax effect | 0 | 307 |
Reclassification of gains recognized in net loss | -265 | -462 |
Tax effect | 0 | 178 |
Amortization of unrealized (losses) gains on investment securities transferred from available-for-sale to held-to-maturity | -93 | 100 |
Tax effect | 0 | -39 |
Other comprehensive income (loss) net of tax amount | 990 | -943 |
Comprehensive loss | ($3,199) | ($1,293) |
CONSOLIDATED_STATEMENTS_OF_SHA
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (USD $) | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Accumulated Other Comprehensive Income (Loss) [Member] |
In Thousands, except Share data, unless otherwise specified | |||||
BEGINNING BALANCE at Dec. 31, 2012 | $22,676 | $7,815 | $34,192 | ($20,040) | $709 |
BEGINNING BALANCE (in shares) at Dec. 31, 2012 | 7,815,385 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | -350 | -350 | |||
Other comprehensive income (loss) | -943 | -943 | |||
Issuance of common stock (in shares) | 162,272 | ||||
Issuance of common stock | 220 | 163 | 57 | ||
Stock based compensation | 20 | 20 | |||
ENDING BALANCE at Dec. 31, 2013 | 21,623 | 7,978 | 34,269 | -20,390 | -234 |
ENDING BALANCE (in shares) at Dec. 31, 2013 | 7,977,657 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net loss | -4,189 | -4,189 | |||
Other comprehensive income (loss) | 990 | 990 | |||
Issuance of common stock (in shares) | 24,000,000 | 24,054,670 | |||
Issuance of common stock | 22,242 | 24,054 | -1,812 | ||
Stock based compensation | 63 | 63 | |||
ENDING BALANCE at Dec. 31, 2014 | $40,729 | $32,032 | $32,520 | ($24,579) | $756 |
ENDING BALANCE (in shares) at Dec. 31, 2014 | 32,032,327 |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Cash flows from operating activities: | ||
Net loss | ($4,189,000) | ($350,000) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Provision for loan losses | 7,954,000 | 35,000 |
Provision for depreciation and amortization | 646,000 | 970,000 |
Net amortization of bond premiums and discounts | 1,167,000 | 1,714,000 |
Stock based compensation | 63,000 | 20,000 |
Gain on sale of investment securities | -265,000 | -462,000 |
Gain on sale of branches | 0 | -586,000 |
(Gain) loss on sale of foreclosed assets, net | -193,000 | 47,000 |
Valuation adjustment on foreclosed assets | 1,772,000 | 1,590,000 |
Earnings on bank-owned life insurance | -210,000 | -241,000 |
Earnings from mortgage banking operations | -571,000 | -628,000 |
Gain on sale of problem loans held for sale | -1,150,000 | 0 |
Originations of mortgage loans held for sale | -24,440,000 | -20,767,000 |
Proceeds from sale of loans held for sale | 33,418,000 | 21,993,000 |
Recovery of impairment loss on redemption of securities | -298,000 | 0 |
Changes in assets and liabilities: | ||
Other assets | -153,000 | 2,274,000 |
Accrued interest receivable | -51,000 | 293,000 |
Other liabilities | -1,483,000 | -569,000 |
Accrued interest payable | 62,000 | -94,000 |
Net cash provided by operating activities | 12,079,000 | 5,239,000 |
Cash flows from investing activities: | ||
Proceeds from sales and calls of investment securities available-for-sale | 22,737,000 | 20,873,000 |
Proceeds from paydowns of investment securities available-for-sale | 1,065,000 | 5,631,000 |
Proceeds from paydowns of investment securities held-to-maturity | 15,323,000 | 12,384,000 |
Purchases of investment securities available-for-sale | -53,787,000 | -53,397,000 |
Purchases of investment securities held-to-maturity | 0 | -24,660,000 |
Redemption (purchase) of certificates of deposit | 4,066,000 | -5,390,000 |
Net cash from sale of branches | 0 | -39,622,000 |
Redemption of FHLB stock | 1,288,000 | 339,000 |
Net decrease in loans outstanding | 17,863,000 | 566,000 |
Disposal (purchase) of bank premises and equipment | 29,000 | -125,000 |
Proceeds from sales of foreclosed assets | 5,428,000 | 8,292,000 |
Net cash (used in) provided by investing activities | 14,012,000 | -75,109,000 |
Cash flows from financing activities: | ||
Net repayments from borrowings | -22,000,000 | 0 |
Net increase in deposit accounts | 3,565,000 | 15,129,000 |
Proceeds from issuance of common stock | 22,242,000 | 220,000 |
Net cash provided by financing activities | 3,807,000 | 15,349,000 |
Change in cash and cash equivalents | 29,898,000 | -54,521,000 |
Cash and cash equivalents at beginning of period | 128,629,000 | 183,150,000 |
Cash and cash equivalents at end of period | 158,527,000 | 128,629,000 |
Supplemental disclosures of cash flow information: | ||
Interest paid on deposits and borrowings | -8,026,000 | 8,865,000 |
Income taxes paid | -110,000 | 0 |
Supplemental disclosures of noncash investing and financing activities: | ||
Unrealized gains (losses) on investment securities available-for-sale, net of taxes | 1,248,000 | -943,000 |
Loans transferred from held for investment to held for sale | 13,193,000 | 0 |
Transfers of loans to foreclosed assets | 2,287,000 | 3,295,000 |
Bank premise and equipment transferred to held for investment from held for sale | 0 | 34,000 |
Transfer of available-for-sale securities to held-to-maturity securities | 0 | 66,122,000 |
Loans transferred from held for sale to held for investment | 3,054,000 | 3,638,000 |
Amortization of net losses on investment securities transferred to held-to-maturity | -93,000 | 0 |
Supplemental disclosure for sale of branches: | ||
Proceeds from sale of fixed assets | 0 | 1,867,000 |
Proceeds from sale of loans | 0 | 15,061,000 |
Assumption of customer deposits | 0 | -57,361,000 |
Gain on sale of branches | 0 | 586,000 |
Proceeds from sale of other assets | 0 | 225,000 |
Total proceeds paid to First Bank | $0 | ($39,622,000) |
ORGANIZATION_AND_SUMMARY_OF_SI
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2014 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
Nature of Operations | |
Four Oaks Fincorp, Inc. (the "Company") was incorporated under the laws of the State of North Carolina on February 5, 1997. The Company’s primary function is to serve as the holding company for its owned subsidiaries, Four Oaks Bank & Trust Company, Inc. (the "Bank") and Four Oaks Mortgage Services, L.L.C (inactive). The Bank operates fourteen offices in eastern and central North Carolina, and its primary source of revenue is derived from loans to customers and from its securities portfolio. The loan portfolio is comprised mainly of real estate, commercial, and consumer loans. These loans are primarily collateralized by residential and commercial properties, commercial equipment, and personal property. | |
Basis of Presentation | |
The consolidated financial statements include the accounts and transactions of the Company, a bank holding company incorporated under the laws of the State of North Carolina, and its wholly-owned subsidiaries, the Bank, and Four Oaks Mortgage Services, L.L.C., which became inactive on September 30, 2012. All significant intercompany transactions have been eliminated. In March 2006, the Company formed Four Oaks Statutory Trust I, a wholly owned Delaware statutory business trust (the “Trust”), for the sole purpose of issuing Trust Preferred Securities (as defined in Note I - Trust Preferred Securities). The Trust is not included in the consolidated financial statements of the Company. | |
Certain amounts previously presented in our Consolidated Financial Statements for the prior periods have been reclassified to conform to current classifications. All such reclassifications had no impact on the prior period's Statements of Operations, Comprehensive Income (Loss, or Shareholders' Equity as previously reported. | |
Use of Estimates | |
Preparing consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for loan losses, fair value of impaired loans, fair value of foreclosed assets, other than temporary impairment of investment securities available-for-sale and held-to-maturity, and the valuation allowance against deferred tax assets. | |
Cash and Cash Equivalents | |
For the purpose of presentation in the consolidated statements of cash flows, cash and cash equivalents are defined as those amounts included in the balance sheet captions cash and due from banks, and interest-earning deposits. | |
Federal regulations require institutions to set aside specified amounts of cash as reserves against transactions and time deposits. As of December 31, 2014, the daily average gross reserve requirement was $0 due to the large amount of cash on the balance sheet. | |
Investment Securities | |
Investment securities are classified into three categories: | |
(1) Held-to-Maturity - Debt securities that the Company has the positive intent and the ability to hold to maturity are classified as held-to-maturity and reported at amortized cost. | |
(2) Trading - Debt and equity securities that are bought and held principally for the purpose of selling them in the near term are classified as trading securities and reported at fair value, with unrealized gains and losses included in earnings. | |
(3) Available-for-Sale - Debt and equity securities not classified as either securities held-to-maturity or trading securities are reported at fair value, with unrealized gains and losses excluded from earnings and reported, net of income taxes, as other comprehensive income, a separate component of shareholders' equity. Gains and losses on sales of securities, computed based on specific identification of adjusted cost of each security, are included in income at the time of the sale. Premiums and discounts are amortized into interest income using a method that approximates the interest method over the period to maturity. | |
Transfers of securities into held-to-maturity from available-for-sale are made at fair value as of the transfer date. The unrealized gain or loss as of the transfer date is retained in accumulated other comprehensive income and in the carrying value of the held-to-maturity securities. The unrealized gain or loss is then amortized over the remaining life of the securities. | |
Each investment security in a loss position is evaluated for other-than-temporary impairment on at least a quarterly basis. The review includes an analysis of the facts and circumstances of each individual investment such as: (1) the length of time and the extent to which the fair value has been below cost, (2) changes in the earnings performance, credit rating, asset quality, or business prospects of the issuer, (3) the ability of the issuer to make principal and interest payments, (4) changes in the regulatory, economic, or technological environment of the issuer, and (5) changes in the general market condition of either the geographic area or industry in which the issuer operates. | |
Regardless of these factors, if we have developed a plan to sell the security or it is likely that we will be forced to sell the security in the near future, then the impairment is considered other-than-temporary and the carrying value of the security is permanently written down to the current fair value with the difference between the new carrying value and the amortized cost charged to earnings. If we do not intend to sell the security and it is not more likely than not that we will be required to sell the security before recovery of its amortized cost basis less any current period credit loss, the other-than-temporary impairment is separated into the following: (1) the amount representing the credit loss and (2) the amount related to all other factors. The amount of the total other-than- temporary impairment related to the credit loss is recognized in earnings and the amount of the total other-than-temporary impairment related to other factors is recognized in other comprehensive income, net of applicable taxes. | |
Loans Held for Sale | |
As part of the asset resolution plan (the "Asset Resolution Plan") executed during 2014, the Company transferred $10.1 million of loans held for investment to loans held for sale in anticipation of near term loan sales. Other loans held for sale generally represent single-family, residential first mortgage loans on a pre-sold basis originated by our mortgage division. Commitments to sell the residential first mortgage loans are made after the intent to proceed with mortgage applications are initiated with borrowers, and all necessary components of the loan are approved according to secondary market underwriting standards of the investor that purchases the loan. Upon closing, these loans, together with their servicing rights, are sold to mortgage loan investors under prearranged terms. Loans held for sale are measured at the lower of cost or fair value on an aggregated basis within the consolidated balance sheet under the caption “loans held for sale”. | |
Rate Lock Commitments | |
The Company enters into commitments to originate loans whereby the interest rate on the loan is determined prior to funding (rate lock commitments). As required by Accounting Standard Codification ("ASC") ASC 815, Derivatives and Hedging, rate lock commitments related to the origination of mortgage loans held for sale and the corresponding forward loan sale commitments are considered to be derivatives. The commitments are generally for periods of 60 days and are at market rates. | |
In order to mitigate the risk from interest rate fluctuations, the Company enters into forward loan sale commitments on a “best efforts” basis while the loan is in the pipeline. Interest rate lock commitments and forward sales commitments are not material to the financial statements for any period presented. | |
Loans | |
Loans are stated at the amount of unpaid principal, reduced by an allowance for loan losses. Interest on all loan classifications is calculated by using the simple interest method on daily balances of the principal amount outstanding. | |
Loan origination fees are deferred, as well as certain direct loan origination costs. Such costs and fees are recognized as an adjustment to yield over the contractual lives of the related loans utilizing the interest method. | |
For all classes of loans, a loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect full repayment of all principal and accrued interest when due either under the terms of the original loan agreement or within reasonably modified contractual terms. Once a loan has been determined to meet the definition of impairment, the amount of that impairment is measured through one of the following methods; a calculation of the net present value of the expected future cash flows of the loan discounted by the effective interest rate of the loan or by determining the fair market value of the underlying collateral securing the loan. If a deficit is calculated, the amount of the measured impairment results in the establishment of a specific valuation allowance or charge-off, and is incorporated into the Bank's allowance for loan and lease losses. Groups of small dollar impaired loans with similar risk characteristics are evaluated for impairment collectively. | |
Income Recognition on Impaired and Nonaccrual Loans | |
Loans, including impaired loans, are generally classified as nonaccrual when doubts arise regarding the full collectibility of principal or interest and we are therefore uncertain that the borrower can satisfy the contractual terms of the loan agreement. In addition our policy is to place a loan on nonaccrual status at the point when the loan becomes past due 90 days unless there is sufficient documentation to establish that the loan is well secured and in the process of collection. If a loan or a portion of a loan is classified as doubtful or is partially charged-off, the loan is generally classified as nonaccrual. | |
While a loan is classified as nonaccrual and the future collectibility of the recorded loan balance is doubtful, collections of interest and principal are generally applied as a reduction to the principal outstanding, except in the case of loans with scheduled amortizations where the payment is generally applied to the oldest payment due. When the future collectibility of the recorded loan balance is expected, interest income may be recognized on a cash basis. In the case where a nonaccrual loan had been partially charged-off, recognition of interest on a cash basis is limited to that which would have been recognized on the recorded loan balance at the contractual interest rate. Receipts in excess of that amount are recorded as recoveries to the allowance for loan losses until prior charge-offs have been fully recovered. | |
Allowance for Loan Losses | |
The allowance for loan losses is established through periodic charges to earnings in the form of a provision for loan losses. Increases to the allowance for loan losses occur as a result of provisions charged to operations and recoveries of amounts previously charged-off, and decreases to the allowance occur when loans are charged-off because management believes that the uncollectibility of a loan balance is confirmed. Management evaluates the adequacy of our allowance for loan losses on at least a quarterly basis. The evaluation of the adequacy of the allowance for loan losses involves the consideration of loan growth, loan portfolio composition and industry diversification, historical loan loss experience, current delinquency levels, adverse conditions that might affect a borrower’s ability to repay the loan, estimated value of underlying collateral, prevailing economic conditions and all other relevant factors derived from our history of operations. Additionally, regulatory agencies review our allowance for loan losses and may require additional provisions for estimated losses based on judgments that differ from those of management. | |
Management has developed a model for evaluating the adequacy of the allowance for loan losses. The model uses the Company’s internal grading system to quantify the risk of each loan. The grade is initially assigned by the lending officer and/or the credit administration function. The internal grading system is reviewed and tested periodically by an independent internal loan review function as well as an independent external credit review firm. The testing process involves the evaluation of a sample of new loans, loans having been identified as possessing potential weakness in credit quality, and past due and nonaccrual loans to determine the ongoing effectiveness of the internal grading system. In addition, various regulatory agencies, as an integral part of their examination process, periodically review the Company's allowance for loan losses. Such agencies may require us to recognize adjustments to the allowance based on their judgments of information available to them at the time of their examination. | |
The grading system is comprised of seven risk categories for active loans. Grades 1 through 4 demonstrate various degrees of risk, but each is considered to have the capacity to perform in accordance with the terms of the loan. Loans possessing a grade of 5 exhibit characteristics which indicate higher risk that the loan may not be able to perform in accordance with the terms of the loan. Grade 6 loans are considered substandard and are generally impaired. Grade 7 loans are considered doubtful and would be included in nonaccrual loans. Loans can also be classified as non-accrual, TDR, or otherwise impaired, all of which are considered impaired. | |
Once a loan has been determined to meet the definition of impairment, the amount of that impairment is measured through one of the following methods: a calculation of the net present value of the expected future cash flows of the loan discounted by the effective interest rate of the loan or by determining the fair market value of the underlying collateral securing the loan. If the fair value market value of collateral method is selected for use, an updated collateral value is generally obtained based on where the loan is in the collection process and the age of the existing appraisal. Groups of small dollar impaired loans with similar risk characteristics are evaluated for impairment collectively. Other impaired loans are then analyzed individually to determine the net value of collateral or cash flows and an estimate of potential loss. The net value of collateral per our analysis is determined using various subjective discounts, selling expenses and a review of the assumptions used to generate the current appraisal. If collection is deemed to be collateral dependent then the deficiency is generally charged off. Appraised values on real estate collateral are subject to constant change and management makes certain assumptions about how the age of an appraisal impacts current value. Impaired loans are re-evaluated periodically to determine the adequacy of specific reserves and charge-offs. | |
Loans that are not assessed for specific reserves under FASB ASC 310-10 are reserved for under FASB ASC 450. The loans analyzed under FASB ASC 450 are assigned a reserve based on a quantitative factor and a qualitative factor. The quantitative factor is based on historical charge-off levels for each call report category and is adjusted for the loan's risk grade. The qualitative factors address loan growth, loan portfolio composition and industry diversification, historical loan loss experience, current delinquency levels, prevailing economic conditions and all other relevant factors derived from our history of operations. Together these two components comprise the ASC 450, or general, reserve. | |
The Bank determines the quantitative ASC 450 reserve using a charge-off metric of the greater of (i) the charge-off rate from the most recent 8 quarters (rolling two years) or (ii) the charge-off rate from the most recent 12 quarters (rolling three years). This provides for the highest base charge-off rate regardless of whether the historical charge-offs are improving or declining. In addition, the Bank assigns a different percentage ("multiplier") of the base charge-off rate to the balances for each risk grade within a loan category to reflect the varied risk of charge-off for each. The standard multipliers range from 0% for a risk grade 1 and 300% for a risk grade 6. In addition, categories that have a concentrated level of charge-offs associated with a particular risk grade could have an additional reserve factor of 50% to 100% added to that particular risk grade. Categories that have had historically high charge-offs also have an additional reserve factor between 25% to 100% added to the risk grade 5s and 6s to account for the additional risk in those categories. The reserve amount by risk grade is calculated and then combined for a blended quantitative reserve factor for each loan category. | |
The allowance for loan losses represents management’s estimate of an appropriate amount to provide for known and inherent losses in the loan portfolio in the normal course of business. While management believes the methodology used to establish the allowance for loan losses incorporates the best information available at the time, future adjustments to the level of the allowance may be necessary and the results of operations could be adversely affected should circumstances differ substantially from the assumptions initially used. We believe that the allowance for loan losses was established in conformity with generally accepted accounting principles. However, upon examination by various regulatory agencies, adjustments to the allowance may be required. Likewise, there can be no assurance that the existing allowance for loan losses is adequate should there be deterioration in the quality of any loans or changes in any of the factors discussed above. Any increases in the provision for loan losses resulting from such deterioration or change in condition could adversely affect our financial condition and results of operations. | |
Bank Premises and Equipment | |
Land is carried at cost. Buildings, furniture, and equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method based on the estimated useful lives of assets. Useful lives range from 5 to 10 years for furniture and equipment and 40 years for buildings. Expenditures for repairs and maintenance are charged to expense as incurred. | |
Stock in Federal Home Loan Bank of Atlanta | |
The Company owned Federal Home Loan Bank of Atlanta (“FHLB”) stock totaling $4.8 million at December 31, 2014 and $6.1 million at December 31, 2013. Based on the continued payment of dividends and that redemption of this stock has historically been at par, management believes that its investment in FHLB stock was not other-than-temporarily impaired as of December 31, 2014 or December 31, 2013. However, there can be no assurance that the impact of recent or future legislation on the Federal Home Loan Banks will not cause a decrease in the value of the FHLB stock held by the Company. | |
Foreclosed Assets | |
Assets acquired as a result of foreclosure are valued at fair value, less estimated selling costs, at the date of foreclosure establishing a new cost basis. After foreclosure, valuations of the property are periodically performed by management and the assets are carried at the lower of cost or fair value minus estimated costs to sell. Losses from the acquisition of property in full or partial satisfaction of debt are treated as credit losses. Routine holding costs, subsequent declines in value, and gains or losses on disposition are included in other income and expense. | |
Income Taxes | |
Accrued taxes represent the estimated amount payable to or receivable from taxing jurisdictions, either currently or in the future, and are reported, on a net basis, as a component of “other assets” in the consolidated balance sheets. The calculation of the Company’s income tax expense is complex and requires the use of many estimates and judgments in its determination. | |
Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. These temporary differences consist primarily of the allowance for loan losses, differences in the financial statement and income tax basis in premises and equipment and differences in financial statement and income tax basis in accrued liabilities. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which the temporary differences are expected to be recovered or settled. Deferred tax assets are reduced by a valuation allowance if it is more likely than not that the tax benefits will not be fully realized. | |
Management’s determination of the realization of the net deferred tax asset is based upon management’s judgment of various future events and uncertainties, including the timing and amount of future income and the implementation of various tax plans to maximize realization of the deferred tax asset. As of December 31, 2014, a $22.0 million valuation allowance has been established. | |
From time to time, management bases the estimates of related tax liabilities on its belief that future events will validate management’s current assumptions regarding the ultimate outcome of tax-related exposures. While the Company has obtained the opinion of advisors that the anticipated tax treatment of these transactions should prevail and has assessed the relative merits and risks of the appropriate tax treatment, examination of the Company’s income tax returns, changes in tax law and regulatory guidance may impact the treatment of these transactions and resulting provisions for income taxes. | |
Stock Compensation Plans | |
The Company accounts for stock based awards granted to employees using the fair value method. The cost of employee services received in exchange for an award of equity instruments in the financial statements over the period the employee is required to perform the services in exchange for the award (usually the vesting period). The cost of employee services received in exchange for an award is based on the grant-date fair value of the award. Excess tax benefits are reported as financing cash inflows, rather than as a reduction of taxes paid, which is included within operating cash flows. | |
Recent Accounting Pronouncements | |
In August 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205-40), Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. This update requires management to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about an entity’s ability to continue as a going concern within one year after the date that the financial statements are issued. Management’s evaluation should be based on relevant conditions and events that are known and reasonably knowable at the date the financial statements are issued. Substantial doubt about an entity’s ability to continue as a going concern exists when relevant conditions and events, considered in the aggregate, indicate that it is probable that an entity will be unable to meet its obligations as they become due within one year after the date that the financial statements are issued. If the substantial doubt is alleviated as a result of consideration of management’s plans, the entity should disclose information that enables financial statement users to understand the principal conditions or events that raised substantial doubt, management’s evaluation of the conditions and management’s plans to alleviate the substantial doubt. If substantial doubt exists about an entity’s ability to continue as a going concern, and the substantial doubt is not alleviated after consideration of management’s plans, an entity should include a statement in the footnotes indicating that there is substantial doubt about the entity’s ability to continue as a going concern. The amendments in this update become effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. The Company does not believe the adoption of this update will have a material impact of the Company’s consolidated financial statements. | |
In August 2014, the FASB issued ASU No. 2014-14, Receivables - Troubled Debt Restructurings by Creditors (Subtopic 310-40), Classification of Certain Government-Guaranteed Mortgage Loans upon Foreclosure. This update addresses classification of government-guaranteed mortgage loans, including those where guarantees are offered by the Federal Housing Administration (“FHA”), the U.S. Department of Housing and Urban Development (“HUD”), and the U.S. Department of Veterans Affairs (“VA”). Although current accounting guidance stipulates proper measurement and classification in situations where a creditor obtains from a debtor, assets in satisfaction of a receivable (such as through foreclosure), current guidance does not specify how to measure and classify foreclosed mortgage loans that are government-guaranteed. Under the provisions of this update, a creditor would derecognize a mortgage loan that has been foreclosed upon, and recognize a separate receivable if the following conditions are met: (1) The loan has a government guarantee that is not separable from the loan before foreclosure, (2) At the time of foreclosure, the creditor has the intent to convey the real estate property to the guarantor and make a claim on the guarantee, and the creditor has the ability to recover under that claim, and (3) At the time of foreclosure, any amount of the claim that is determined on the basis of the fair value of the real estate is fixed. The amendments within this update are effective for annual and interim periods beginning after December 15, 2014. The Company does not believe the adoption of this update will have a material impact of the Company’s consolidated financial statements. | |
In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements of Accounting Standards Codification (“ASC”) Topic 605, Revenue Recognition, and most industry-specific guidance on revenue recognition throughout the ASC. The new standard is principles based and provides a five step model to determine when and how revenue is recognized. The core principle of the new standard is that revenue should be recognized when a company transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. The new standard also requires disclosure of qualitative and quantitative information surrounding the amount, nature, timing and uncertainty of revenues and cash flows arising from contracts with customers. The new standard is effective for the Company in the first quarter of the year ended December 31, 2017 and can be applied either retrospectively to all periods presented or as a cumulative-effect adjustment as of the date of adoption. Early adoption is not permitted. The Company is currently evaluating the impact of adoption of the new standard on its consolidated financial statements. | |
In January 2014, the FASB issued ASU No. 2014-04, Receivables–Troubled Debt Restructurings by Creditors (Subtopic 310-40): Reclassification of Residential Real Estate Collateralized Consumer Mortgage Loans upon Foreclosure. This update clarifies that an in-substance repossession or foreclosure occurs upon either the creditor obtaining legal title to the residential real estate property or the borrower conveying all interest in the residential real estate property to the creditor to satisfy that loan through completion of a deed in lieu of foreclosure or through a similar legal agreement. This amendment is effective for annual and interim periods beginning after December 15, 2014. The Company does not expect the adoption of this guidance to have a material impact on the Company's financial statements. | |
Other accounting standards that have been issued by the FASB or other standards-setting bodies are not expected to have a material impact on the Company’s financial position, results of operations and cash flows. | |
From time to time the FASB issues exposure drafts for proposed statements of financial accounting standards. Such exposure drafts are subject to comment from the public, to revisions by the FASB and to final issuance by the FASB as statements of financial accounting standards. Management considers the effect of the proposed statements on the consolidated financial statements of the Company and monitors the status of changes to and proposed effective dates of exposure drafts. |
NET_LOSS_PER_SHARE_NET_LOSS_PE
NET LOSS PER SHARE NET LOSS PER SHARE | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Earnings Per Share [Abstract] | |||||||||
Net Loss Per Share | NET LOSS PER SHARE | ||||||||
Basic net income (loss) per share represents earnings credited to common shareholders divided by the weighted average number of common shares outstanding during the period. Diluted income (loss) per share reflects additional common shares that would have been outstanding if dilutive potential common shares had been issued, as well as any adjustment to income that would result from the assumed issuance. Potential common shares that may be issued by the Company relate solely to outstanding stock options. | |||||||||
Basic and diluted net income (loss) per common share have been computed based upon net income (loss) as presented in the accompanying consolidated statements of operations divided by the weighted average number of common shares outstanding or assumed to be outstanding as summarized below (amounts in thousands, except share data): | |||||||||
Twelve Months Ended | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Net loss available to common shareholders | $ | (4,189 | ) | $ | (350 | ) | |||
Weighted average number of common shares - basic | 17,484,541 | 7,914,110 | |||||||
Effect of dilutive stock options | — | — | |||||||
Weighted average number of common shares - dilutive | 17,484,541 | 7,914,110 | |||||||
Basic earnings per common share | $ | (0.24 | ) | $ | (0.04 | ) | |||
Diluted earnings per common share | $ | (0.24 | ) | $ | (0.04 | ) | |||
Anti-dilutive awards | 227,407 | 301,705 | |||||||
For the twelve months ended December 31, 2014, there were 227,407 outstanding stock options that were anti-dilutive due to the losses incurred compared to 301,705 for the twelve month period ended December 31, 2013. | |||||||||
During the twelve month period ended December 31, 2014, the Company raised approximately $22.2 million, net of fees and costs, through the Rights Offering and the Standby Offering (each as defined below). As a result of the offerings, approximately 24.0 million shares of common stock were issued. Consequently, the average weighted shares of common stock increased 9.6 million for the year ended December 31, 2014 compared to 7.9 million at December 31, 2013. |
INVESTMENT_SECURITIES
INVESTMENT SECURITIES | 12 Months Ended | |||||||||||||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | ||||||||||||||||||||||||||||||||
INVESTMENT SECURITIES | INVESTMENT SECURITIES | |||||||||||||||||||||||||||||||
The amortized cost, gross unrealized gains, gross unrealized losses and fair values of securities available-for-sale as of December 31, 2014 and 2013 are as follows (amounts in thousands): | ||||||||||||||||||||||||||||||||
Securities Available-for-Sale | ||||||||||||||||||||||||||||||||
At December 31 | ||||||||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||||||||
Amortized | Gross | Gross | Fair | Amortized | Gross | Gross | Fair | |||||||||||||||||||||||||
Cost | Unrealized | Unrealized | Value | Cost | Unrealized | Unrealized | Value | |||||||||||||||||||||||||
Gains | Losses | Gains | Losses | |||||||||||||||||||||||||||||
Taxable municipal securities | $ | 16,412 | $ | 686 | $ | 20 | $ | 17,078 | $ | 6,176 | $ | — | $ | 243 | $ | 5,933 | ||||||||||||||||
Mortgage-backed securities | ||||||||||||||||||||||||||||||||
GNMA | 16,204 | 163 | 103 | 16,264 | 25,773 | — | 296 | 25,477 | ||||||||||||||||||||||||
FNMA & FHLMC | 30,992 | — | 134 | 30,858 | — | — | — | — | ||||||||||||||||||||||||
Trust preferred securities | — | — | — | — | 1,175 | — | 150 | 1,025 | ||||||||||||||||||||||||
Equity securities | 11 | — | — | 11 | 98 | 33 | — | 131 | ||||||||||||||||||||||||
Total | $ | 63,619 | $ | 849 | $ | 257 | $ | 64,211 | $ | 33,222 | $ | 33 | $ | 689 | $ | 32,566 | ||||||||||||||||
The amortized cost, gross unrealized gains, gross unrealized losses and fair values of securities held-to-maturity as of December 31, 2014 and 2013 are as follows (amounts in thousands): | ||||||||||||||||||||||||||||||||
Securities Held-to-Maturity | ||||||||||||||||||||||||||||||||
At December 31 | ||||||||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||||||||
Amortized | Gross | Gross | Fair | Amortized | Gross | Gross | Fair | |||||||||||||||||||||||||
Cost | Unrealized | Unrealized | Value | Cost | Unrealized | Unrealized | Value | |||||||||||||||||||||||||
Gains | Losses | Gains | Losses | |||||||||||||||||||||||||||||
Taxable municipal securities | $ | 3,584 | $ | — | $ | 28 | $ | 3,556 | $ | 3,635 | $ | 3 | $ | 157 | $ | 3,481 | ||||||||||||||||
Mortgage-backed securities | ||||||||||||||||||||||||||||||||
GNMA | 74,482 | 887 | 244 | 75,125 | 89,892 | 162 | 2,171 | 87,883 | ||||||||||||||||||||||||
FNMA | 3,517 | 44 | — | 3,561 | 4,486 | — | 19 | 4,467 | ||||||||||||||||||||||||
Total | $ | 81,583 | $ | 931 | $ | 272 | $ | 82,242 | $ | 98,013 | $ | 165 | $ | 2,347 | $ | 95,831 | ||||||||||||||||
Management evaluates each quarter whether unrealized losses on securities represent impairment that is other than temporary. For debt securities, the Company considers its intent to sell the securities or if it is more likely than not that the Company will be required to sell the securities. If such impairment is identified, based upon the intent to sell or the more likely than not threshold, the carrying amount of the security is reduced to fair value with a charge to earnings. Upon the result of the aforementioned review, management then reviews for potential other than temporary impairment based upon other qualitative factors. In making this evaluation, management considers changes in market rates relative to those available when the security was acquired, changes in market expectations about the timing of cash flows from securities that can be prepaid, performance of the debt security, and changes in the market's perception of the issuer's financial health and the security's credit quality. If determined that a debt security has incurred other than temporary impairment, then the amount of the credit related impairment is determined. If a credit loss is evident, the amount of the credit loss is charged to earnings and the non-credit related impairment is recognized through other comprehensive income. | ||||||||||||||||||||||||||||||||
The unrealized gains and losses on debt securities at December 31, 2014 resulted from changing market interest rates compared to the yields available at the time the underlying securities were purchased. Fourteen of fifty-five GNMA collateralized mortgage obligations, six of nine MBS pass-through securities, and twelve of thirty-one taxable municipal securities contained net unrealized losses at December 31, 2014. Management identified no impairment related to credit quality. At December 31, 2014 management had the intent and ability to hold impaired securities and no impairment was evaluated as other than temporary. As a result, no other than temporary impairment losses were recognized during the twelve months ended December 31, 2014. | ||||||||||||||||||||||||||||||||
The following tables reflect the gross unrealized losses and fair values of securities available-for-sale, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at the dates presented. (amounts in thousands): | ||||||||||||||||||||||||||||||||
Securities Available-for-Sale | ||||||||||||||||||||||||||||||||
31-Dec-14 | ||||||||||||||||||||||||||||||||
Less Than 12 Months | 12 Months or More | Total | ||||||||||||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||||||||||
value | losses | value | losses | value | losses | |||||||||||||||||||||||||||
Taxable municipal securities | $ | 2,580 | $ | 20 | $ | — | $ | — | $ | 2,580 | $ | 20 | ||||||||||||||||||||
Mortgage-backed securities | ||||||||||||||||||||||||||||||||
GNMA | 7,425 | 103 | — | — | 7,425 | 103 | ||||||||||||||||||||||||||
FNMA & FHLMC | 30,858 | 134 | — | — | 30,858 | 134 | ||||||||||||||||||||||||||
Total temporarily impaired securities | $ | 40,863 | $ | 257 | $ | — | $ | — | $ | 40,863 | $ | 257 | ||||||||||||||||||||
Securities Available-for-Sale | ||||||||||||||||||||||||||||||||
31-Dec-13 | ||||||||||||||||||||||||||||||||
Less Than 12 Months | 12 Months or More | Total | ||||||||||||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||||||||||
value | losses | value | losses | value | losses | |||||||||||||||||||||||||||
Taxable municipal securities | $ | 5,933 | $ | 243 | $ | — | $ | — | $ | 5,933 | $ | 243 | ||||||||||||||||||||
Mortgage-backed securities | ||||||||||||||||||||||||||||||||
GNMA | $ | 25,477 | $ | 296 | $ | — | $ | — | $ | 25,477 | $ | 296 | ||||||||||||||||||||
Total temporarily impaired securities | $ | 31,410 | $ | 539 | $ | — | $ | — | $ | 31,410 | $ | 539 | ||||||||||||||||||||
Other than temporary impairment: | ||||||||||||||||||||||||||||||||
Trust preferred securities | — | $ | — | 1,025 | 150 | 1,025 | 150 | |||||||||||||||||||||||||
Total other than temporarily impaired securities | $ | — | $ | — | $ | 1,025 | $ | 150 | $ | 1,025 | $ | 150 | ||||||||||||||||||||
The following tables reflect the gross unrealized losses and fair values of securities held-to-maturity, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at the dates presented. (amounts in thousands): | ||||||||||||||||||||||||||||||||
Securities Held-to-Maturity | ||||||||||||||||||||||||||||||||
31-Dec-14 | ||||||||||||||||||||||||||||||||
Less Than 12 Months | 12 Months or More | Total | ||||||||||||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||||||||||
value | losses | value | losses | value | losses | |||||||||||||||||||||||||||
Taxable municipal securities | $ | — | $ | — | $ | 3,556 | $ | 28 | $ | 3,556 | $ | 28 | ||||||||||||||||||||
Mortgage-backed securities | ||||||||||||||||||||||||||||||||
GNMA | 7,594 | 41 | 12,240 | 203 | 19,834 | 244 | ||||||||||||||||||||||||||
Total temporarily impaired securities | $ | 7,594 | $ | 41 | $ | 15,796 | $ | 231 | $ | 23,390 | $ | 272 | ||||||||||||||||||||
Securities Held-to-Maturity | ||||||||||||||||||||||||||||||||
31-Dec-13 | ||||||||||||||||||||||||||||||||
Less Than 12 Months | 12 Months or More | Total | ||||||||||||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||||||||||
value | losses | value | losses | value | losses | |||||||||||||||||||||||||||
Taxable municipal securities | $ | 2,776 | $ | 157 | $ | — | $ | — | $ | 2,776 | $ | 157 | ||||||||||||||||||||
Mortgage backed securities | ||||||||||||||||||||||||||||||||
GNMA | 74,830 | 2,073 | 2,223 | 98 | 77,053 | 2,171 | ||||||||||||||||||||||||||
FNMA | 4,467 | 19 | — | — | 4,467 | 19 | ||||||||||||||||||||||||||
Total temporarily impaired securities | $ | 82,073 | $ | 2,249 | $ | 2,223 | $ | 98 | $ | 84,296 | $ | 2,347 | ||||||||||||||||||||
The following table shows a roll forward of the amount related to credit losses recognized on debt securities held by the Company for which a portion of an other-than-temporary impairment was recognized in other comprehensive income (amounts in thousands): | ||||||||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||||||||
Balance of credit losses on debt securities at the beginning of the period | $ | 75 | 75 | |||||||||||||||||||||||||||||
Income received on other-than-temporary impaired debt securities | (75 | ) | — | |||||||||||||||||||||||||||||
Balance of credit losses on debt securities at the end of the period | $ | — | $ | 75 | ||||||||||||||||||||||||||||
The amortized cost and fair value of available-for-sale and held-to-maturity securities at December 31, 2014 by expected maturities are shown below (amounts in thousands). Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. | ||||||||||||||||||||||||||||||||
Available-for-Sale | ||||||||||||||||||||||||||||||||
Taxable municipal securities | Mortgage-backed securities - GNMA | Mortgage-backed securities - FNMA & FHLMC | ||||||||||||||||||||||||||||||
Amortized | Fair Value | Amortized | Fair Value | Amortized | Fair Value | |||||||||||||||||||||||||||
Cost | Cost | Cost | ||||||||||||||||||||||||||||||
Due within one year | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||||||
Due after one year through five years | — | — | — | — | — | — | ||||||||||||||||||||||||||
Due after five years through ten years | — | — | — | — | — | — | ||||||||||||||||||||||||||
Due after ten years | 16,412 | 17,078 | 16,204 | 16,264 | 30,992 | 30,858 | ||||||||||||||||||||||||||
Total Munis, GNMA, FNMA & FHLMC securities | $ | 16,412 | $ | 17,078 | $ | 16,204 | $ | 16,264 | $ | 30,992 | $ | 30,858 | ||||||||||||||||||||
Securities without a specific maturity: | ||||||||||||||||||||||||||||||||
Equity securities | 11 | 11 | ||||||||||||||||||||||||||||||
Total other securities | $ | 11 | $ | 11 | ||||||||||||||||||||||||||||
Held-to-Maturity | ||||||||||||||||||||||||||||||||
Taxable municipal securities | Mortgage-backed securities - GNMA | Mortgage-backed securities - FNMA | ||||||||||||||||||||||||||||||
Amortized | Fair Value | Amortized | Fair Value | Amortized | Fair Value | |||||||||||||||||||||||||||
Cost | Cost | Cost | ||||||||||||||||||||||||||||||
Due within one year | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||||||
Due after one year through five years | 1,534 | 1,521 | — | — | — | — | ||||||||||||||||||||||||||
Due after five years through ten years | 2,050 | 2,035 | 769 | 799 | 3,517 | 3,561 | ||||||||||||||||||||||||||
Due after ten years | — | — | 73,713 | 74,326 | — | — | ||||||||||||||||||||||||||
Total Munis, GNMA, FNMA securities | $ | 3,584 | $ | 3,556 | $ | 74,482 | $ | 75,125 | $ | 3,517 | $ | 3,561 | ||||||||||||||||||||
Securities with a carrying value of approximately $101.8 million and $92.8 million at December 31, 2014 and 2013, respectively, were pledged to secure public deposits and for other purposes required or permitted by law. | ||||||||||||||||||||||||||||||||
Sales and calls of securities available-for-sale during 2014 and 2013 of $22.7 million and $20.9 million generated gross realized gains of $563,172 and $462,460, respectively, and no gross realized losses for 2014 and 2013. |
LOANS_AND_ALLOWANCE_FOR_LOAN_L
LOANS AND ALLOWANCE FOR LOAN LOSSES | 12 Months Ended | |||||||||||||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||||||||||||
Loans and Leases Receivable Disclosure [Abstract] | ||||||||||||||||||||||||||||||||
LOANS AND ALLOWANCE FOR LOAN LOSSES | LOANS AND ALLOWANCE FOR LOAN LOSSES | |||||||||||||||||||||||||||||||
The classification of loan segments as of December 31, 2014 and 2013 are summarized as follows (amounts in thousands): | ||||||||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||||||||
Commercial and industrial | $ | 24,286 | $ | 25,858 | ||||||||||||||||||||||||||||
Commercial construction and land development | 53,642 | 66,253 | ||||||||||||||||||||||||||||||
Commercial real estate | 200,510 | 214,159 | ||||||||||||||||||||||||||||||
Residential construction | 28,130 | 28,697 | ||||||||||||||||||||||||||||||
Residential mortgage | 135,022 | 147,300 | ||||||||||||||||||||||||||||||
Consumer | 7,248 | 6,750 | ||||||||||||||||||||||||||||||
Other | 499 | 738 | ||||||||||||||||||||||||||||||
Consumer credit cards | 2,276 | 2,339 | ||||||||||||||||||||||||||||||
Business credit cards | 1,251 | 1,124 | ||||||||||||||||||||||||||||||
452,864 | 493,218 | |||||||||||||||||||||||||||||||
Deferred cost and (fees), net | (608 | ) | (506 | ) | ||||||||||||||||||||||||||||
Allowance for loan losses | (9,377 | ) | (11,590 | ) | ||||||||||||||||||||||||||||
Net Loans | $ | 442,879 | $ | 481,122 | ||||||||||||||||||||||||||||
Loans held for sale | $ | 2,882 | $ | — | ||||||||||||||||||||||||||||
Nonperforming assets | ||||||||||||||||||||||||||||||||
Nonperforming assets at December 31, 2014 and 2013 consist of the following (amounts in thousands): | ||||||||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||||||||
Loans past due ninety days or more and still accruing | $ | 17 | $ | 23 | ||||||||||||||||||||||||||||
Nonaccrual loans | 8,259 | 27,227 | ||||||||||||||||||||||||||||||
Loans held for sale - nonperforming | 1,865 | — | ||||||||||||||||||||||||||||||
Foreclosed assets | 3,782 | 8,502 | ||||||||||||||||||||||||||||||
Total | $ | 13,923 | $ | 35,752 | ||||||||||||||||||||||||||||
Related Party Loans | ||||||||||||||||||||||||||||||||
The Company had loan and deposit relationships with directors, executive officers, and associates of these parties as of December 31, 2014 and 2013. The following is a reconciliation of these loans (amounts in thousands): | ||||||||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||||||||
Beginning balance | $ | 9,840 | 15,009 | |||||||||||||||||||||||||||||
New loans | 1,539 | 2,600 | ||||||||||||||||||||||||||||||
Principal repayments | (2,602 | ) | (7,769 | ) | ||||||||||||||||||||||||||||
Ending balance | $ | 8,777 | 9,840 | |||||||||||||||||||||||||||||
As a matter of policy, these loans and credit lines are approved by the Company’s Board of Directors and are made with interest rates, terms, and collateral requirements comparable to those required of other borrowers. In the opinion of management, these loans do not involve more than the normal risk of collectibility. | ||||||||||||||||||||||||||||||||
Credit Risk | ||||||||||||||||||||||||||||||||
We use an internal grading system to assign the degree of inherent risk on each individual loan. The grade is initially assigned by the lending officer and reviewed by the loan administration function throughout the life of the loan. The credit grades have been defined as follows: | ||||||||||||||||||||||||||||||||
• | Grade 1 - Lowest Risk | |||||||||||||||||||||||||||||||
Loans secured by properly margined liquid collateral such as certificates of deposit, government securities, cash value of life insurance, stock actively traded on one of the major stock exchanges, etc. Repayment is definite and being handled as agreed. Maintains a strong, liquid financial condition as evidenced by a current financial statement in the Bank. Repayment agreement is definite, realistic, and being handled as agreed. | ||||||||||||||||||||||||||||||||
• | Grade 2 - Satisfactory Quality | |||||||||||||||||||||||||||||||
Loans secured by properly margined collateral with a definite repayment agreement in effect. Unsecured loans with repayment agreements that are definite, realistic, and are being handled as agreed. Repayment source well defined by proven income, cash flow, trade asset turn, etc. Multiple repayment sources exist. Individual and businesses will typically have a sound financial condition. | ||||||||||||||||||||||||||||||||
• | Grade 3 - Satisfactory - Merits Attention | |||||||||||||||||||||||||||||||
Repayment sources are well defined by proven income, cash flow, trade asset turn, etc., but may be weaker than Grade 2. Loans to weaker individuals or business borrowers with a strong endorser or guarantor. Fully collectible, unsecured loans or loans secured by other than approved collateral for which an acceptable repayment agreement has not been established. Loans being repaid as agreed that require close following because of complexity, information or underwriting deficiencies, emerging signs of weakness or non-standard terms. Secured loans repaying as agreed where collateral value or marketability are questionable but do not materially affect risk. | ||||||||||||||||||||||||||||||||
• | Grade 4 - Low Satisfactory | |||||||||||||||||||||||||||||||
Borrower’s ability to repay from primary (intended) repayment sources may be speculative or not clearly sufficient to ensure performance as contracted. Loans are performing as contracted and secondary repayment sources are clearly sufficient to protect against the risk of principal or income loss. It is reasonable to expect that the circumstances causing repayment capacity to be uncertain will be resolved within six months. Access to alternative financing sources exists but may be limited due to noted weaknesses. | ||||||||||||||||||||||||||||||||
• | Grade 5 - Special Mention | |||||||||||||||||||||||||||||||
Special Mention risk loans include the following characteristics: Loans currently performing satisfactorily but with potential weaknesses that may, if not corrected, weaken the asset or inadequately protect the Bank’s position at some future date. Potential weaknesses exist, generally the result of deviations from prudent lending practices, such as over advances on collateral or unproven primary repayment sources. Loans where adverse economic conditions that develop subsequent to the loan origination that do not jeopardize liquidation of the debt but do increase the level of risk may also warrant this rating. Such trends may be in the borrower’s options, credit quality or financial strength. New loans with exceptions where no mitigating factors are justified, however, loans are not typically made if the grade is Special Mention at inception without management approval. | ||||||||||||||||||||||||||||||||
• | Grades 6-8 - Substandard (Grade 6), Doubtful (Grade 7) and Loss (Grade 8) | |||||||||||||||||||||||||||||||
A substandard loan is inadequately protected by the current sound net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans classified as Substandard have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt; they are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected. Loans classified Doubtful have all the weaknesses inherent in loans classified Substandard, plus the added characteristic that the weaknesses make collection or liquidation in full on the basis of currently existing facts, conditions, and values highly questionable and improbable. Loans classified as Loss are considered uncollectable and of such little value that their continuance as bankable assets is not warranted. This classification does not mean that the asset has absolutely no recovery or salvage value, but rather that it is not practical or desirable to defer writing off this worthless loan even though partial recovery may be affected in the future. Loans are not typically made if graded Substandard or worse at inception without management's approval. | ||||||||||||||||||||||||||||||||
The following table illustrates credit risk profile by creditworthiness class as of December 31, 2014 and 2013 (amounts in thousands): | ||||||||||||||||||||||||||||||||
December 31, 2014 | ||||||||||||||||||||||||||||||||
Commercial and | Commercial | Commercial | Residential - | Residential - | Consumer - | Other - Loans | Total (1) | |||||||||||||||||||||||||
Industrial | Construction | Real Estate- | Construction | Mortgage | Other | |||||||||||||||||||||||||||
and Land | Other | |||||||||||||||||||||||||||||||
Development | ||||||||||||||||||||||||||||||||
1 - Lowest Risk | $ | 2,099 | $ | — | $ | — | $ | — | $ | — | $ | 1,638 | $ | — | $ | 3,737 | ||||||||||||||||
2 - Satisfactory Quality | 606 | 630 | 2,206 | — | 14,794 | 314 | 11 | 18,561 | ||||||||||||||||||||||||
3 - Satisfactory Quality - Merits Attention | 9,506 | 10,625 | 81,761 | 1,893 | 53,007 | 3,556 | 225 | 160,573 | ||||||||||||||||||||||||
4 - Low Satisfactory | 11,932 | 34,709 | 110,683 | 26,074 | 56,359 | 1,186 | 146 | 241,089 | ||||||||||||||||||||||||
5 - Special mention | 143 | 1,892 | 3,989 | — | 8,720 | 62 | 117 | 14,923 | ||||||||||||||||||||||||
6 - Substandard or worse (1) | — | 5,786 | 1,871 | 163 | 2,142 | 492 | — | 10,454 | ||||||||||||||||||||||||
$ | 24,286 | $ | 53,642 | $ | 200,510 | $ | 28,130 | $ | 135,022 | $ | 7,248 | $ | 499 | $ | 449,337 | |||||||||||||||||
(1) | The above table does not include business and consumer credit cards and loans held for sale. As of December 31, 2014, there were $2.5 million in risk grade 6 loans classified as held for sale. | |||||||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||||||||
Commercial and | Commercial | Commercial | Residential - | Residential - | Consumer - | Other - | Total (1) | |||||||||||||||||||||||||
Industrial | Construction | Real Estate- | Construction | Mortgage | Other | Loans | ||||||||||||||||||||||||||
and Land | Other | |||||||||||||||||||||||||||||||
Development | ||||||||||||||||||||||||||||||||
1 - Lowest Risk | $ | 2,014 | $ | — | $ | — | $ | — | $ | — | $ | 1,365 | $ | 8 | $ | 3,387 | ||||||||||||||||
2 - Satisfactory Quality | 646 | 374 | 2,696 | 2 | 12,811 | 412 | 15 | 16,956 | ||||||||||||||||||||||||
3 - Satisfactory Quality - Merits Attention | 9,639 | 14,296 | 75,898 | 3,473 | 53,144 | 3,628 | 482 | 160,560 | ||||||||||||||||||||||||
4 - Low Satisfactory | 12,616 | 36,723 | 121,522 | 23,779 | 57,460 | 1,235 | 107 | 253,442 | ||||||||||||||||||||||||
5 - Special mention | 137 | 1,922 | 2,558 | 262 | 8,450 | 63 | 126 | 13,518 | ||||||||||||||||||||||||
6 - Substandard or worse | 806 | 12,938 | 11,485 | 1,181 | 15,435 | 47 | — | 41,892 | ||||||||||||||||||||||||
$ | 25,858 | $ | 66,253 | $ | 214,159 | $ | 28,697 | $ | 147,300 | $ | 6,750 | $ | 738 | $ | 489,755 | |||||||||||||||||
(1) | The above table does not include business and consumer credit cards and loans held for sale. | |||||||||||||||||||||||||||||||
The following table illustrates the credit card portfolio exposure as of December 31, 2014 and 2013 (amounts in thousands): | ||||||||||||||||||||||||||||||||
December 31, 2014 | December 31, 2013 | |||||||||||||||||||||||||||||||
Consumer - | Business- | Consumer- | Business- | |||||||||||||||||||||||||||||
Credit Card | Credit Card | Credit Card | Credit Card | |||||||||||||||||||||||||||||
Performing | $ | 2,263 | $ | 1,248 | $ | 2,316 | $ | 1,124 | ||||||||||||||||||||||||
Non Performing | 13 | 3 | 23 | — | ||||||||||||||||||||||||||||
$ | 2,276 | $ | 1,251 | $ | 2,339 | $ | 1,124 | |||||||||||||||||||||||||
Nonaccruals and Past Due Loans | ||||||||||||||||||||||||||||||||
The following tables illustrate the age analysis of past due loans by loan class as of December 31, 2014 and 2013 (amounts in thousands): | ||||||||||||||||||||||||||||||||
December 31, 2014 | ||||||||||||||||||||||||||||||||
30-89 Days | Nonaccrual (1) | Greater than 90 Days Past Due | Total Past | Current | Total | |||||||||||||||||||||||||||
Past Due | Due | Loans | ||||||||||||||||||||||||||||||
Commercial & industrial | $ | 14 | $ | — | $ | — | $ | 14 | $ | 24,272 | $ | 24,286 | ||||||||||||||||||||
Commercial construction & land development | 27 | 5,533 | — | 5,560 | 48,082 | 53,642 | ||||||||||||||||||||||||||
Commercial real estate | — | 983 | — | 983 | 199,527 | 200,510 | ||||||||||||||||||||||||||
Residential construction | — | — | — | — | 28,130 | 28,130 | ||||||||||||||||||||||||||
Residential mortgage | 1,058 | 1,271 | — | 2,329 | 132,693 | 135,022 | ||||||||||||||||||||||||||
Consumer | 82 | 472 | — | 554 | 6,694 | 7,248 | ||||||||||||||||||||||||||
Consumer credit cards | 46 | — | 14 | 60 | 2,216 | 2,276 | ||||||||||||||||||||||||||
Business credit cards | 41 | — | 3 | 44 | 1,207 | 1,251 | ||||||||||||||||||||||||||
Other loans | 84 | — | — | 84 | 415 | 499 | ||||||||||||||||||||||||||
Total | $ | 1,352 | $ | 8,259 | $ | 17 | $ | 9,628 | $ | 443,236 | $ | 452,864 | ||||||||||||||||||||
(1) | The above table includes loans held for investment only. As of December 31, 2014, there were $67,000 in loans 30-89 days past due and $1.9 million in loans on nonaccrual classified as held for sale. | |||||||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||||||||
30-89 Days | Nonaccrual | Greater than 90 Days Past Due | Total Past | Current | Total | |||||||||||||||||||||||||||
Past Due | Due | Loans | ||||||||||||||||||||||||||||||
Commercial & industrial | $ | 34 | $ | 651 | — | $ | 685 | $ | 25,173 | $ | 25,858 | |||||||||||||||||||||
Commercial construction & land development | 252 | 9,536 | — | 9,788 | 56,465 | 66,253 | ||||||||||||||||||||||||||
Commercial real estate | 749 | 6,391 | — | 7,140 | 207,019 | 214,159 | ||||||||||||||||||||||||||
Residential construction | — | 695 | — | 695 | 28,002 | 28,697 | ||||||||||||||||||||||||||
Residential mortgage | 421 | 9,943 | — | 10,364 | 136,936 | 147,300 | ||||||||||||||||||||||||||
Consumer | 11 | 11 | — | 22 | 6,728 | 6,750 | ||||||||||||||||||||||||||
Consumer credit cards | 76 | — | 23 | 99 | 2,240 | 2,339 | ||||||||||||||||||||||||||
Business credit cards | 52 | — | — | 52 | 1,072 | 1,124 | ||||||||||||||||||||||||||
Other loans | — | — | — | — | 738 | 738 | ||||||||||||||||||||||||||
Total | $ | 1,595 | $ | 27,227 | 23 | $ | 28,845 | $ | 464,373 | $ | 493,218 | |||||||||||||||||||||
Impaired Loans | ||||||||||||||||||||||||||||||||
Impaired loans are those loans for which the Bank does not expect full repayment of all principal and accrued interest when due either under the terms of the original loan agreement or within reasonably modified contractual terms. If the loan has been restructured, such as in the case of a troubled debt restructuring ("TDR"), the loan continues to be considered impaired for the duration of the restructured loan term. Whereas loans which are classified as Substandard (Risk Grade 6) are not necessarily impaired, all loans which are classified as Doubtful (Risk Grade 7) are considered impaired. | ||||||||||||||||||||||||||||||||
Once a loan has been determined to meet the definition of impairment, the amount of that impairment is measured through one of a number of available methods; a calculation of the net present value of the expected future cash flows of the loan discounted by the effective interest rate of the loan, through the observable market value of the loan or should the loan be collateral dependent, upon the fair market value of the underlying assets securing the loan. If a deficit is calculated, the amount of the measured impairment results in the establishment of a specific valuation allowance or reserve or charge-off, and is incorporated into the Bank's allowance for loan and lease losses. | ||||||||||||||||||||||||||||||||
When a loan has been designated as impaired and full collection of principal and interest under the contractual terms is not assured, the impaired loan will be placed into nonaccrual status and interest income will not be recognized. Payments received against such loans are initially applied fully to the principal balance of the note until the principal balance is satisfied. Subsequent payments are thereupon applied to the accrued interest balance which only then results in the recognition of interest income. Payments received against accruing impaired loans are applied in the same manner as that of accruing loans which have not been deemed impaired. The recorded investment in impaired notes does not include deferred fees or accrued interest and management deems this amount to be immaterial. | ||||||||||||||||||||||||||||||||
The following tables illustrate the impaired loans by loan class as of December 31, 2014 and 2013 (amounts in thousands): | ||||||||||||||||||||||||||||||||
December 31, 2014 | ||||||||||||||||||||||||||||||||
Recorded | Unpaid | Related | Average | Interest | ||||||||||||||||||||||||||||
Investment | Principal | Allowance | Recorded | Income | ||||||||||||||||||||||||||||
Balance | Investment | Recognized | ||||||||||||||||||||||||||||||
With no related allowance recorded: | ||||||||||||||||||||||||||||||||
Commercial construction & land development | 5,445 | 6,454 | — | 6,715 | 15 | |||||||||||||||||||||||||||
Commercial real estate | 3,468 | 4,295 | — | 4,103 | 139 | |||||||||||||||||||||||||||
Residential mortgage | 2,030 | 1,614 | — | 2,279 | 59 | |||||||||||||||||||||||||||
Consumer | 467 | 729 | — | 524 | — | |||||||||||||||||||||||||||
Subtotal: | $ | 11,410 | $ | 13,092 | $ | — | $ | 13,621 | $ | 213 | ||||||||||||||||||||||
With an allowance recorded: | ||||||||||||||||||||||||||||||||
Commercial construction & land development | 1,433 | 2,656 | 580 | 1,866 | 92 | |||||||||||||||||||||||||||
Commercial real estate | 372 | 379 | 17 | 378 | 19 | |||||||||||||||||||||||||||
Residential mortgage | 192 | 169 | 61 | 224 | 5 | |||||||||||||||||||||||||||
Consumer | 8 | 6 | 5 | 8 | — | |||||||||||||||||||||||||||
Subtotal: | $ | 2,005 | $ | 3,210 | $ | 663 | $ | 2,476 | $ | 116 | ||||||||||||||||||||||
Totals: | ||||||||||||||||||||||||||||||||
Commercial | 10,718 | 13,784 | 597 | 13,062 | 265 | |||||||||||||||||||||||||||
Consumer | 475 | 735 | 5 | 532 | — | |||||||||||||||||||||||||||
Residential | 2,222 | 1,783 | 61 | 2,503 | 64 | |||||||||||||||||||||||||||
Grand Total | $ | 13,415 | $ | 16,302 | $ | 663 | $ | 16,097 | $ | 329 | ||||||||||||||||||||||
(1) | The above table includes loans held for investment only. As of December 31, 2014, there were $2.4 million in impaired loans classified as held for sale and there were no reserves recorded for these loans. | |||||||||||||||||||||||||||||||
At December 31, 2014, the recorded investment in loans considered impaired totaled $13.4 million. Of the total investment in loans considered impaired, $2.0 million were found to show specific impairment for which a $663,000 valuation allowance was recorded; the remaining $11.4 million in impaired loans required no specific valuation allowance because either previously established valuation allowances had been absorbed by partial charge-offs or loan evaluations had no indication of impairment which would require a valuation allowance. | ||||||||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||||||||
Recorded | Unpaid | Related | Interest | |||||||||||||||||||||||||||||
Investment | Principal | Allowance | Average | Income | ||||||||||||||||||||||||||||
Balance | Recorded | Recognized | ||||||||||||||||||||||||||||||
Investment | ||||||||||||||||||||||||||||||||
With no related allowance recorded: | ||||||||||||||||||||||||||||||||
Commercial and industrial | $ | 380 | $ | 517 | $ | — | $ | 491 | $ | 2 | ||||||||||||||||||||||
Commercial construction & land development | 11,142 | 15,809 | — | 13,259 | 168 | |||||||||||||||||||||||||||
Commercial real estate other | 8,437 | 10,131 | — | 9,190 | 132 | |||||||||||||||||||||||||||
Residential construction | 486 | 486 | — | 474 | 26 | |||||||||||||||||||||||||||
Residential mortgage | 10,948 | 12,731 | — | 11,624 | 121 | |||||||||||||||||||||||||||
Consumer | 11 | 22 | — | 17 | — | |||||||||||||||||||||||||||
Subtotal: | $ | 31,404 | $ | 39,696 | $ | — | $ | 35,055 | $ | 449 | ||||||||||||||||||||||
With an allowance recorded: | ||||||||||||||||||||||||||||||||
Commercial and industrial | $ | 309 | $ | 322 | $ | 80 | $ | 321 | $ | — | ||||||||||||||||||||||
Commercial construction & land development | 1,315 | 2,033 | 264 | 1,348 | — | |||||||||||||||||||||||||||
Commercial real estate other | 4,026 | 4,096 | 888 | 4,104 | 136 | |||||||||||||||||||||||||||
Residential construction | 695 | 1,134 | 137 | 749 | — | |||||||||||||||||||||||||||
Residential mortgage | 1,427 | 1,593 | 456 | 1,499 | 8 | |||||||||||||||||||||||||||
Consumer | — | — | — | — | — | |||||||||||||||||||||||||||
Subtotal: | $ | 7,772 | $ | 9,178 | $ | 1,825 | $ | 8,021 | $ | 144 | ||||||||||||||||||||||
Totals: | ||||||||||||||||||||||||||||||||
Commercial | 25,609 | 32,908 | 1,232 | 28,713 | 438 | |||||||||||||||||||||||||||
Consumer | 11 | 22 | — | 17 | — | |||||||||||||||||||||||||||
Residential | 13,556 | 15,944 | 593 | 14,346 | 155 | |||||||||||||||||||||||||||
Grand Total: | $ | 39,176 | $ | 48,874 | $ | 1,825 | $ | 43,076 | $ | 593 | ||||||||||||||||||||||
At December 31, 2013, the recorded investment in loans considered impaired totaled $39.2 million. Of the total investment in loans considered impaired, $7.8 million were found to show specific impairment for which a $1.8 million valuation allowance was recorded; the remaining $31.4 million in impaired loans required no specific valuation allowance because either previously established valuation allowances had been absorbed by partial charge-offs or loan evaluations had no indication of impairment which would require a valuation allowance. | ||||||||||||||||||||||||||||||||
Troubled Debt Restructurings | ||||||||||||||||||||||||||||||||
Loans are classified as a TDR when, for economic or legal reasons which result in a debtor experiencing financial difficulties, the Bank grants a concession through a modification of the original loan agreement that would not otherwise be considered. Generally concessions are granted as a result of a borrower's inability to meet the contractual repayment obligations of the initial loan terms and in the interest of improving the likelihood of recovery of the loan. We may grant these concessions by a number of means such as (1) forgiving principal or interest, (2) reducing the stated interest rate to a below market rate, (3) deferring principal payments, (4) changing repayment terms from amortizing to interest only, (5) extending the repayment period, or (6) accepting a change in terms based upon a bankruptcy plan. However, the Bank only restructures loans for borrowers that demonstrate the willingness and capacity to repay the loan under reasonable terms and where the Bank has sufficient protection provided by the cash flow of the underlying collateral or business. | ||||||||||||||||||||||||||||||||
Loans in the process of renewal or modification are reviewed by the Bank to determine if the risk grade assigned is accurate based on updated information. All loans identified by the Bank's internal loan grading system to pose a heightened level of risk at or prior to renewal or modification are additionally reviewed to determine if the loan should be classified as a TDR. The Bank's knowledge of the borrower's situation and any updated financial information obtained is first used to determine whether the borrower is experiencing financial difficulty. Once this is determined, the Bank reviews the modification terms to determine whether a concession has been granted. If the Bank determines that both conditions have been met, the loan will be classified as a TDR. If the Bank determines that both conditions have not been met, the loan is not classified as a TDR, but would typically then be monitored for any additional deterioration. Documentation to support this determination of TDR classification is maintained within the credit file. | ||||||||||||||||||||||||||||||||
For the year ended December 31, 2014, the Bank modified three loans totaling $104,000 which were deemed TDRs. The following tables present a breakdown of TDRs by loan class and the type of concession made to the borrower for the periods indicated (amounts in thousands, except number of loans): | ||||||||||||||||||||||||||||||||
For the Year Ended | ||||||||||||||||||||||||||||||||
December 31, 2014 | ||||||||||||||||||||||||||||||||
Number of loans | Pre-Modification Outstanding Recorded Investment | Post-Modification Outstanding Recorded Investment | ||||||||||||||||||||||||||||||
Extended payment terms: | ||||||||||||||||||||||||||||||||
Consumer | 1 | 4 | 4 | |||||||||||||||||||||||||||||
Subtotal | 1 | $ | 4 | $ | 4 | |||||||||||||||||||||||||||
Forgiveness of principal: | ||||||||||||||||||||||||||||||||
Commercial construction and land development | 2 | 100 | 43 | |||||||||||||||||||||||||||||
Subtotal | 2 | $ | 100 | $ | 43 | |||||||||||||||||||||||||||
Total | 3 | $ | 104 | $ | 47 | |||||||||||||||||||||||||||
For the Year Ended | ||||||||||||||||||||||||||||||||
31-Dec-13 | ||||||||||||||||||||||||||||||||
Number of loans | Pre-Modification Outstanding Recorded Investment | Post-Modification Outstanding Recorded Investment | ||||||||||||||||||||||||||||||
Extended payment terms: | ||||||||||||||||||||||||||||||||
Residential mortgage | 2 | 202 | 202 | |||||||||||||||||||||||||||||
Subtotal | 2 | $ | 202 | $ | 202 | |||||||||||||||||||||||||||
Other: | ||||||||||||||||||||||||||||||||
Commercial real estate | 1 | 33 | 33 | |||||||||||||||||||||||||||||
Subtotal | 1 | $ | 33 | $ | 33 | |||||||||||||||||||||||||||
Total | 3 | $ | 235 | $ | 235 | |||||||||||||||||||||||||||
There were no loans modified as TDRs and for which there was a payment default during the year ended December 31, 2014. | ||||||||||||||||||||||||||||||||
The table below details the progression of TDRs which have been entered into during the previous 12 months (amounts in thousands, except number of loans): | ||||||||||||||||||||||||||||||||
December 31, 2014 | ||||||||||||||||||||||||||||||||
Paid in full | Paying as restructured | Converted to non-accrual | Foreclosure/Default | |||||||||||||||||||||||||||||
Number of loans | Recorded Investment | Number of loans | Recorded Investment | Number of loans | Recorded Investment | Number of loans | Recorded Investment | |||||||||||||||||||||||||
Extended payment terms | — | — | 1 | 4 | — | — | — | — | ||||||||||||||||||||||||
Forgiveness of principal | — | — | 2 | 17 | — | — | — | — | ||||||||||||||||||||||||
Total | — | $ | — | 3 | $ | 21 | — | $ | — | — | $ | — | ||||||||||||||||||||
Allowance for Loan Losses and Recorded Investment in Loans | ||||||||||||||||||||||||||||||||
The allowance for loan losses represents management’s estimate of an amount adequate to provide for known and inherent losses in the loan portfolio in the normal course of business. Management evaluates the adequacy of this allowance on a monthly basis which includes a review of loans both specifically and collectively evaluated for impairment. | ||||||||||||||||||||||||||||||||
Following is an analysis of the allowance for loan losses by loan segment as of and for the years ended December 31, 2014 and 2013 (amounts in thousands): | ||||||||||||||||||||||||||||||||
December 31, 2014 | ||||||||||||||||||||||||||||||||
Real Estate | ||||||||||||||||||||||||||||||||
Commercial and Industrial | Commercial construction and land development | Commercial real estate | Residential construction | Residential mortgage | Consumer | Other | Totals | |||||||||||||||||||||||||
Balance, beginning of period | $ | 487 | $ | 5,037 | $ | 2,981 | $ | 713 | $ | 2,146 | $ | 188 | $ | 38 | $ | 11,590 | ||||||||||||||||
Provision for loan losses | (84 | ) | 2,778 | 2,382 | (106 | ) | 3,041 | (36 | ) | (21 | ) | 7,954 | ||||||||||||||||||||
Loans charged-off | (492 | ) | (3,107 | ) | (3,315 | ) | (171 | ) | (4,847 | ) | (183 | ) | — | (12,115 | ) | |||||||||||||||||
Recoveries | 208 | 397 | 334 | — | 866 | 120 | 23 | 1,948 | ||||||||||||||||||||||||
Net (charge-offs) recoveries | (284 | ) | (2,710 | ) | (2,981 | ) | (171 | ) | (3,981 | ) | (63 | ) | 23 | (10,167 | ) | |||||||||||||||||
Balance, end of period | $ | 119 | $ | 5,105 | $ | 2,382 | $ | 436 | $ | 1,206 | $ | 89 | $ | 40 | $ | 9,377 | ||||||||||||||||
Ending balance: individually evaluated for impairment | $ | — | $ | 516 | $ | 4 | $ | — | $ | — | $ | 4 | $ | — | $ | 524 | ||||||||||||||||
Ending balance: collectively evaluated for impairment | $ | 119 | $ | 4,589 | $ | 2,378 | $ | 436 | $ | 1,206 | $ | 85 | $ | 40 | $ | 8,853 | ||||||||||||||||
Loans: | ||||||||||||||||||||||||||||||||
Ending Balance | $ | 25,537 | $ | 53,642 | $ | 200,510 | $ | 28,130 | $ | 135,022 | $ | 9,524 | $ | 499 | $ | 452,864 | ||||||||||||||||
Ending balance: individually evaluated for impairment | $ | — | $ | 6,678 | $ | 3,801 | $ | — | $ | 2,030 | $ | 471 | $ | — | $ | 12,980 | ||||||||||||||||
Ending balance: collectively evaluated for impairment (1) | $ | 25,537 | $ | 46,964 | $ | 196,709 | $ | 28,130 | $ | 132,992 | $ | 9,053 | $ | 499 | $ | 439,884 | ||||||||||||||||
(1) | At December 31, 2014 there was $436,000 in impaired loans collectively evaluated for impairment with $139,000 in reserves established. | |||||||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||||||||
Real Estate | ||||||||||||||||||||||||||||||||
Commercial and Industrial | Commercial construction and land development | Commercial real estate | Residential construction | Residential mortgage | Consumer | Other | Totals | |||||||||||||||||||||||||
Balance, beginning of period | $ | 1,185 | $ | 7,251 | $ | 2,961 | $ | 423 | $ | 4,471 | $ | 188 | $ | 70 | $ | 16,549 | ||||||||||||||||
Provision for loan losses | (801 | ) | 958 | 701 | 428 | (1,332 | ) | 117 | (36 | ) | 35 | |||||||||||||||||||||
Loans charged-off | (411 | ) | (3,759 | ) | (2,226 | ) | (138 | ) | (1,553 | ) | (271 | ) | — | (8,358 | ) | |||||||||||||||||
Recoveries | 514 | 587 | 1,545 | — | 560 | 154 | 4 | 3,364 | ||||||||||||||||||||||||
Net recoveries (charge-offs) | 103 | (3,172 | ) | (681 | ) | (138 | ) | (993 | ) | (117 | ) | 4 | (4,994 | ) | ||||||||||||||||||
Balance, end of period | $ | 487 | $ | 5,037 | $ | 2,981 | $ | 713 | $ | 2,146 | $ | 188 | $ | 38 | $ | 11,590 | ||||||||||||||||
Ending balance: individually evaluated for impairment | $ | 80 | $ | 264 | $ | 887 | $ | 137 | $ | 384 | $ | — | $ | — | $ | 1,752 | ||||||||||||||||
Ending balance: collectively evaluated for impairment | $ | 407 | $ | 4,773 | $ | 2,094 | $ | 576 | $ | 1,762 | $ | 188 | $ | 38 | $ | 9,838 | ||||||||||||||||
Loans: | ||||||||||||||||||||||||||||||||
Ending Balance | $ | 26,982 | $ | 66,253 | $ | 214,159 | $ | 28,697 | $ | 147,300 | $ | 9,089 | $ | 738 | $ | 493,218 | ||||||||||||||||
Ending balance: individually evaluated for impairment | $ | 652 | $ | 12,234 | $ | 12,345 | $ | 1,181 | $ | 11,043 | $ | — | $ | — | $ | 37,455 | ||||||||||||||||
Ending balance: collectively evaluated for impairment (1) | $ | 26,330 | $ | 54,019 | $ | 201,814 | $ | 27,516 | $ | 136,257 | $ | 9,089 | $ | 738 | $ | 455,763 | ||||||||||||||||
(1) | In 2013, the Bank began evaluating small dollar homogeneous impaired loans collectively for impairment and these impaired loans are included in this total. At December 31, 2013, there were $1.7 million in impaired loans collectively evaluated for impairment with $73,000 in reserves established. |
BANK_AND_PREMISES_EQUIPMENT
BANK AND PREMISES EQUIPMENT | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Property, Plant and Equipment [Abstract] | ||||||||
BANK PREMISES AND EQUIPMENT | BANK PREMISES AND EQUIPMENT | |||||||
Company premises and equipment at December 31, 2014 and 2013 are as follows (amounts in thousands): | ||||||||
2014 | 2013 | |||||||
Land | $ | 4,394 | $ | 4,394 | ||||
Buildings and leasehold improvements | 11,189 | 11,171 | ||||||
Furniture and equipment | 11,411 | 11,511 | ||||||
Construction in process | 562 | 509 | ||||||
27,556 | 27,585 | |||||||
Less accumulated depreciation | (15,661 | ) | (15,014 | ) | ||||
$ | 11,895 | $ | 12,571 | |||||
Depreciation expense was $0.8 million and $1.0 million for the years ended December 31, 2014 and 2013, respectively. |
DEPOSITS
DEPOSITS | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Banking and Thrift [Abstract] | ||||||||||||
DEPOSITS | DEPOSITS | |||||||||||
At December 31, 2014, the scheduled maturities of time deposits are as follows (amounts in thousands): | ||||||||||||
Less than | $100,000 | Total | ||||||||||
$100,000 | or more | |||||||||||
2015 | $ | 57,486 | $ | 78,937 | $ | 136,423 | ||||||
2016 | 20,998 | 38,481 | 59,479 | |||||||||
2017 | 7,474 | 13,034 | 20,508 | |||||||||
2018 | 2,393 | 6,794 | 9,187 | |||||||||
2019 | 1,679 | 3,481 | 5,160 | |||||||||
2020 and beyond | 365 | 2,609 | 2,974 | |||||||||
Total time deposits | $ | 90,395 | $ | 143,336 | $ | 233,731 | ||||||
BORROWINGS
BORROWINGS | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Debt Disclosure [Abstract] | |||||||||||||
BORROWINGS | BORROWINGS | ||||||||||||
At December 31, 2014 and 2013, borrowed funds included the following FHLB advances (amounts in thousands): | |||||||||||||
Maturity | Interest Rate | 2014 | 2013 | ||||||||||
May 25, 2016 | 4.46% | Fixed | $ | — | $ | 5,000 | |||||||
November 17, 2016 | 4.11% | Fixed | — | 5,000 | |||||||||
November 30, 2016 | 4.09% | Fixed | — | 7,000 | |||||||||
June 5, 2017 | 4.35% | Fixed | 10,000 | 10,000 | |||||||||
July 3, 2017 | 4.36% | Fixed | 13,000 | 13,000 | |||||||||
July 24, 2017 | 4.34% | Fixed | — | 5,000 | |||||||||
July 31, 2017 | 4.35% | Fixed | 5,000 | 5,000 | |||||||||
August 14, 2017 | 4.08% | Fixed | 5,000 | 5,000 | |||||||||
August 14, 2017 | 3.94% | Fixed | 5,000 | 5,000 | |||||||||
October 4, 2017 | 3.95% | Fixed | 7,000 | 7,000 | |||||||||
February 5, 2018 | 2.06% | Fixed | 10,000 | 10,000 | |||||||||
June 5, 2018 | 2.25% | Fixed | 5,000 | 5,000 | |||||||||
June 5, 2018 | 2.55% | Fixed | 5,000 | 5,000 | |||||||||
June 5, 2018 | 3.03% | Fixed | 5,000 | 5,000 | |||||||||
September 10, 2018 | 3.14% | Fixed | 10,000 | 10,000 | |||||||||
September 18, 2018 | 2.71% | Fixed | 10,000 | 10,000 | |||||||||
$ | 90,000 | $ | 112,000 | ||||||||||
FHLB advances are secured by a floating lien covering the Company’s loan portfolio of qualifying residential (1-4 units) first mortgage loans. At December 31, 2014, the Company has available lines of credit totaling $164 million with the FHLB for borrowing dependent on adequate collateralization. The weighted average rates for the above borrowings at December 31, 2014 and 2013 were 3.42% and 3.58%, respectively. | |||||||||||||
In addition to the above advances, the Company has lines of credit of $16.0 million from various financial institutions to purchase federal funds on a short-term basis. The Company has no federal funds purchases outstanding as of December 31, 2014. |
TRUST_PREFERRED_SECURITIES
TRUST PREFERRED SECURITIES | 12 Months Ended |
Dec. 31, 2014 | |
Trust Preferred Securities [Abstract] | |
TRUST PREFERRED SECURITIES | TRUST PREFERRED SECURITIES |
On March 30, 2006, $12.0 million of trust preferred securities (the “Trust Preferred Securities”) were placed through the Trust. The Trust has invested the net proceeds from the sale of the Trust Preferred Securities in Junior Subordinated Deferrable Interest Debentures (the “Debentures”) issued by the Company and recorded in borrowings on the accompanying consolidated balance sheets. The Trust Preferred Securities pay cumulative cash distributions quarterly at an annual rate, reset quarterly, equal to three month LIBOR plus 1.35%. The dividends paid to holders of the Trust Preferred Securities, which will be recorded as interest expense, are deductible for income tax purposes. The Trust Preferred Securities are redeemable on June 15, 2011 or afterwards in whole or in part, on any June 15, September 15, December 15, or March 15. Redemption is mandatory by June 15, 2036. The Company has fully and unconditionally guaranteed the Trust Preferred Securities through the combined operation of the Debentures and other related documents. The Company’s obligation under the guarantee is unsecured and subordinate to senior and subordinated indebtedness of the Company. The Trust Preferred Securities qualify as Tier I capital for regulatory capital purposes subject to certain limitations. We have the right to defer payment of interest on the Debentures at any time and from time to time for a period not exceeding five years, provided that no deferral period extends beyond the stated maturities of the Debentures. Such deferral of interest payments by the Company will result in a deferral of distribution payments on the related Trust Preferred Securities. Whenever we defer the payment of interest on the Debentures, the Company will be precluded from the payment of cash dividends to shareholders. In January 2011, the Company elected to defer the regularly scheduled interest payments on the Debentures related to our outstanding Trust Preferred Securities. | |
The Company is currently prohibited by the Written Agreement, described in Note K - Regulatory Restrictions, of these Notes to Consolidated Financial Statements, from paying interest on its Debentures without prior approval of the supervisory authorities. The Company and the Bank are prohibited from declaring or paying dividends without prior approval of the supervisory authorities. The Company exercised its right to defer regularly scheduled interest payments on the Debentures. As of December 31, 2014, interest payments of $899,000 have been accrued for and deferred pursuant to the terms of the indenture governing the Debentures. |
SUBORDINATED_PROMISSORY_NOTES
SUBORDINATED PROMISSORY NOTES | 12 Months Ended |
Dec. 31, 2014 | |
Subordinated Debt [Abstract] | |
SUBORDINATED PROMISSORY NOTES | SUBORDINATED PROMISSORY NOTES |
The Company sold $12.0 million aggregate principal amount of subordinated promissory notes to certain accredited investors between May and August 2009. These notes are due 10 years after the date of issuance, beginning May 15, 2019, and the Company is obligated to pay interest at an annualized rate of 8.5% payable in quarterly installments beginning on the third month anniversary of the date of issuance. The Company may prepay the notes at any time after the fifth anniversary of the date of issuance, subject to compliance with applicable law. The Company is currently prohibited by the Written Agreement, described in Note K - Regulatory Restrictions of these Notes to Consolidated Financial Statements, from paying interest on its subordinated promissory notes without prior approval of the supervisory authorities. The Company obtained approval to pay the interest on its subordinated promissory notes for 2014 and 2013. |
INCOME_TAXES
INCOME TAXES | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Income Tax Disclosure [Abstract] | ||||||||
INCOME TAXES | INCOME TAXES | |||||||
Allocation of income tax expense between current and deferred portions is as follows (amounts in thousands): | ||||||||
Years Ended December 31, | ||||||||
2014 | 2013 | |||||||
Current tax expense (benefit): | ||||||||
Federal | $ | — | $ | — | ||||
State | — | — | ||||||
— | — | |||||||
Deferred tax expense (benefit): | ||||||||
Federal | — | — | ||||||
State | — | — | ||||||
— | — | |||||||
Income tax expense (benefit) before adjustment to deferred tax asset valuation allowance | — | — | ||||||
Net deferred tax expense (benefit) | $ | — | $ | — | ||||
The reconciliation of expected income tax at the statutory federal rate of 34% with income tax expense is as follows (amounts in thousands): | ||||||||
Years Ended December 31, | ||||||||
2014 | 2013 | |||||||
Expense computed at statutory rate of 34% | $ | (1,424 | ) | $ | (119 | ) | ||
Effect of state income taxes, net of federal benefit | (22 | ) | (28 | ) | ||||
Tax exempt income | 39 | (494 | ) | |||||
Bank owned life insurance income | (71 | ) | (82 | ) | ||||
Valuation allowance | 1,421 | 708 | ||||||
Other, net | 57 | 15 | ||||||
$ | — | $ | — | |||||
Deferred income taxes consist of the following (amounts in thousands): | ||||||||
Years Ended December 31, | ||||||||
2014 | 2013 | |||||||
Deferred tax assets: | ||||||||
Allowance for loan losses | $ | 3,454 | $ | 4,389 | ||||
Non-qualified stock options | 384 | 368 | ||||||
OTTI | 345 | 602 | ||||||
Net deferred loan fees | 206 | 189 | ||||||
Net operating loss | 16,187 | 16,313 | ||||||
FMV adjustment on purchased assets | 89 | 104 | ||||||
SERP accrual | 178 | 179 | ||||||
Other | 2,545 | 1,354 | ||||||
Unrealized loss on securities | — | 166 | ||||||
Total deferred tax assets | 23,388 | 23,664 | ||||||
Less valuation allowance | (22,013 | ) | (22,542 | ) | ||||
Net deferred tax assets | 1,375 | 1,122 | ||||||
Deferred tax liabilities: | ||||||||
Property and equipment | $ | 809 | $ | 765 | ||||
Prepaid expense | 255 | 328 | ||||||
Unrealized gain on securities | 282 | — | ||||||
Other | 29 | 29 | ||||||
Total deferred tax liabilities | 1,375 | 1,122 | ||||||
Net deferred tax liability, included in other liabilities | $ | — | $ | — | ||||
When tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that would be ultimately sustained. The benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50% likely to be realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above is reflected as a liability for unrecognized tax benefits in the accompanying consolidated balance sheet along with any associated interest and penalties that would be payable to the taxing authorities upon examination. For the years ended December 31, 2014 and 2013, there were no uncertain tax positions taken by the Company. The Company classifies interest and penalties related to income tax assessments, if any, in income tax expense in the consolidated statements of operations. Fiscal years ending December 31, 2009 and thereafter are subject to IRS examination. | ||||||||
We calculate income taxes in accordance with U.S. GAAP, which requires the use of the asset and liability method. The largest components of our net deferred tax asset at December 31, 2014, were related to the activity in our allowance for loan losses and net operating loss carryforwards. In accordance with U.S. GAAP, we regularly assess available positive and negative evidence to determine whether it is more likely than not that our deferred tax asset balances will be recovered. Based upon our analysis of our tax position, including taxes paid in prior years available through carryback and the use of tax planning strategies, at December 31, 2014 and 2013 we recognized a valuation allowance of $22.0 million and $22.5 million, respectively, to properly state our ability to realize this deferred tax asset. Our analysis of our tax position did not include future taxable earnings. Realization of a deferred tax asset requires us to apply significant judgment and is inherently speculative because it may require the future occurrence of circumstances that cannot be predicted with certainty. | ||||||||
As a result of the net operating loss carryforward of $43.6 million at December 31, 2014 which will begin expiring in 2028, and the $22.0 million deferred tax asset valuation allowance, the Company will not record tax expense or tax benefit until positive operating earnings utilizing existing tax loss carryforwards result in exhibited positive performance which would support the partial or full reinstatement of deferred tax assets. |
REGULATORY_RESTRICTIONS
REGULATORY RESTRICTIONS | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Regulatory Capital Requirements [Abstract] | |||||||||||||||||||||
REGULATORY RESTRICTIONS | REGULATORY RESTRICTIONS | ||||||||||||||||||||
North Carolina banking law requires that the Bank may not pay a dividend that would reduce its capital below the applicable required capital. In addition, regulatory authorities may limit payment of dividends by any bank when it is determined that such a limitation is in the public interest and is necessary to ensure the financial soundness of the bank. No dividends were paid to the Company by the Bank during 2014. | |||||||||||||||||||||
Current federal regulations require that the Bank maintain a minimum ratio of total capital to risk weighted assets of 8.0%, with at least 4.0% being in the form of Tier 1 capital, as defined in the regulations. In addition, the Bank must maintain a leverage ratio of 4.0%. To be categorized as well capitalized, the Bank must maintain minimum amounts and ratios as set forth in the table below. At December 31, 2014, the Bank was classified as well capitalized for regulatory capital purposes. | |||||||||||||||||||||
The Bank’s actual capital amounts and ratios are also presented in the table below (amounts in thousands, except ratios): | |||||||||||||||||||||
Actual | Minimum For Capital | Minimum To be Well | |||||||||||||||||||
Adequacy Purposes | Capitalized under | ||||||||||||||||||||
Prompt Corrective | |||||||||||||||||||||
Action Provisions | |||||||||||||||||||||
Amount | Ratio | Amount | Ratio | Amount | Ratio | ||||||||||||||||
As of December 31, 2014: | |||||||||||||||||||||
Total Capital (to Risk Weighted Assets) | $ | 66,498 | 14.7 | % | $ | 36,109 | 8 | % | $ | 45,136 | 10 | % | |||||||||
Tier I Capital (to Risk Weighted Assets) | 60,810 | 13.5 | % | 18,054 | 4 | % | 27,082 | 6 | % | ||||||||||||
Tier I Capital (to Average Assets) | 60,810 | 7.2 | % | 33,844 | 4 | % | 42,305 | 5 | % | ||||||||||||
As of December 31, 2013: | |||||||||||||||||||||
Total Capital (to Risk Weighted Assets) | $ | 50,601 | 10.9 | % | $ | 37,057 | 8 | % | $ | 46,322 | 10 | % | |||||||||
Tier I Capital (to Risk Weighted Assets) | 44,739 | 9.7 | % | 18,529 | 4 | % | 27,793 | 6 | % | ||||||||||||
Tier I Capital (to Average Assets) | 44,739 | 5.5 | % | 32,529 | 4 | % | 40,661 | 5 | % | ||||||||||||
The Company is also subject to capital requirements that differ from the Bank. In order for the Company to be adequately capitalized, total capital to risk weighted assets, Tier 1 capital to risk weighted assets and Tier 1 capital to average assets must be 10.0%, 6.0% and 5.0%, respectively. At December 31, 2014 and 2013, the Company’s total capital to risk weighted assets, Tier 1 capital to risk weighted assets and Tier 1 capital to average assets were 15.0%, 11.6% and 6.2% and 10.7%, 6.3%, and 3.6%, respectively. | |||||||||||||||||||||
In late May 2011, the Company and the Bank entered into a Written Agreement (the "Written Agreement") with the Federal Reserve Bank of Richmond (the "FRB") and the North Carolina Commissioner of Banks (the "NCCOB"). Under the terms of the Written Agreement, the Bank developed and submitted for approval, within the time periods specified, plans to: | |||||||||||||||||||||
• | revise lending and credit administration policies and procedures at the Bank and provide relevant training | ||||||||||||||||||||
• | enhance the Bank's real estate appraisal policies and procedures | ||||||||||||||||||||
• | enhance the Bank's loan grading and independent loan review programs | ||||||||||||||||||||
• | improve the Bank's position with respect to loans, relationships, or other assets in excess of $750,000, which are now or in the future become past due more than 90 days, are on the Bank's problem loan list, or adversely classified in any report of examination of the Bank, and | ||||||||||||||||||||
• | review and revise the Bank's current policy regarding the Bank's allowance for loan and lease losses and maintain a program for the maintenance of an adequate allowance | ||||||||||||||||||||
In addition, the Bank agreed that it will: | |||||||||||||||||||||
• | refrain from extending, renewing, or restructuring any credit to or for the benefit of any borrower, or related interest, whose loans or other extensions of credit have been criticized in any report of examination of the Bank absent prior approval by the Bank's board of directors or a designated committee of the board in accordance with the restrictions in the Written Agreement | ||||||||||||||||||||
• | eliminate from its books, by charge-off or collection, all assets or portions of assets classified as “loss” in any report of examination of the Bank, unless otherwise approved by the FRB and the NCCOB, and | ||||||||||||||||||||
• | take all necessary steps to correct all violations of law or regulation cited by the FRB and the NCCOB | ||||||||||||||||||||
In addition, the Company has agreed that it will: | |||||||||||||||||||||
• | refrain from taking any form of payment representing a reduction in capital from the Bank or make any distributions of interest, principal, or other sums on subordinated debentures or trust preferred securities absent prior regulatory approval | ||||||||||||||||||||
• | refrain from incurring, increasing, or guaranteeing any debt without the prior written approval of the FRB, and | ||||||||||||||||||||
• | refrain from purchasing or redeeming any shares of its stock without the prior written consent of the FRB | ||||||||||||||||||||
Under the terms of the Written Agreement, both the Company and the Bank have agreed to: | |||||||||||||||||||||
• | submit for approval a joint plan to maintain sufficient capital at the Company on a consolidated basis and at the Bank on a stand-alone basis | ||||||||||||||||||||
• | notify the FRB and the NCCOB if the Company's or the Bank's capital ratios fall below the approved capital plan's minimum ratios | ||||||||||||||||||||
• | refrain from declaring or paying any dividends absent prior regulatory approval | ||||||||||||||||||||
• | comply with applicable notice provisions with respect to the appointment of new directors and senior executive officers of the Company and the Bank and legal and regulatory limitations on indemnification and severance payments, and | ||||||||||||||||||||
• | submit annual business plans and budgets and quarterly joint written progress reports regarding compliance with the Written Agreement | ||||||||||||||||||||
In addition to the many improvements in the risk management and governance practices at the Bank, the results of the Rights Offering, Standby Offering, and Asset Resolution Plan have allowed the Company and the Bank to make significant progress towards compliance with the Written Agreement. Currently, the Bank is in full compliance with 19 of the 20 provisions contained in the Written Agreement and continues to address the remaining item that is in partial compliance. The Company and the Bank remain focused on each item in the Written Agreement to ensure progress continues and to ensure that each item is fully addressed and ultimately resolved. To ensure the efforts are effective, the Board of Directors established an Enforcement Action Committee that meets regularly to monitor progress on compliance with the Written Agreement. | |||||||||||||||||||||
Since the Company and the Bank entered the Written Agreement, management has had frequent and regular communication with the FRB and NCCOB. This communication has involved: | |||||||||||||||||||||
• | updates on the progress involving each of the actions outlined in the Written Agreement, | ||||||||||||||||||||
• | specific steps taken by the Company to remain in compliance with the Written Agreement, and | ||||||||||||||||||||
• | communications, verbally and via interim internal reports, regarding the financial status of the Company including, but not limited to, the Company's key capital ratios. | ||||||||||||||||||||
A material failure to comply with the terms of the Written Agreement could subject the Company to additional regulatory actions and further restrictions on its business. These regulatory actions and resulting restrictions on the Company's business may have a material adverse effect on its future results of operations and financial condition. To date, the Company has not received any disagreement from the regulatory authorities regarding actions taken or contemplated. |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Commitments and Contingencies Disclosure [Abstract] | ||||||||
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES | |||||||
The Company is a party to financial instruments with off-balance sheet credit risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit and letters of credit. Those instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the balance sheet. The contract or notional amounts of those instruments reflect the extent of involvement the Bank has in particular classes of financial instruments. The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance-sheet instruments. The Company evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Company, upon extension of credit is based on management’s credit evaluation of the borrower. Collateral obtained varies but may include real estate, stocks, bonds, and certificates of deposit. | ||||||||
Commitments to extend credit are agreements to lend to a customer as long as there is no violation of conditions established in the commitment letter or contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since some of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. | ||||||||
Undisbursed lines of credit are commitments for possible future extensions of credit to customers on existing loans. These lines of credit generally contain a specified maturity date, but could also exclude an expiration date such as is the case for our overdraft protection lines. Similar to commitments, undisbursed lines of credit may not be drawn upon to the total extent to which the Bank is committed and do not necessarily represent future cash requirements. | ||||||||
Stand-by letters of credit are conditional lending commitments issued by the Bank to guarantee the performance of a customer to a third party. Those letters of credit are primarily issued to support public and private borrowing arrangements. Essentially all letters of credit issued have expiration dates within one year. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. | ||||||||
At December 31, 2014 and 2013, financial instruments whose contract amounts represent credit risk were (amounts in thousands): | ||||||||
2014 | 2013 | |||||||
Commitments to extend credit | $ | 14,182 | $ | 7,655 | ||||
Undisbursed lines of credit | 73,888 | 52,326 | ||||||
Financial stand-by letters of credit | 238 | 798 | ||||||
Performance stand-by letters of credit | 1,203 | 193 | ||||||
Legally binding commitments | 89,511 | 60,972 | ||||||
Credit card lines | 12,773 | 13,858 | ||||||
Total | $ | 102,284 | $ | 74,830 | ||||
Litigation Proceedings | ||||||||
On May 20, 2013, the U.S. Department of Justice ("DOJ") issued a subpoena to the Bank requiring the production of documents in connection with an investigation of consumer fraud related to third party payment processing. In connection with this investigation, the Bank negotiated a civil settlement with the DOJ (the "Consent Order"), which was filed with the United States District Court for the Eastern District of North Carolina on January 8, 2014. The Consent Order was filed contemporaneously with the filing of a complaint by the DOJ alleging violation of a variety of laws, including money laundering laws. As part of the terms of the Consent Order, the Bank agreed to pay a civil monetary penalty in the amount of $1.0 million, plus a civil forfeiture in the amount of $200,000. The Consent Order was approved by the District Court on April 26, 2014. As we worked through termination of these relationships, as required by the Consent Order, we entered into various agreements whereby the third party processor clients indemnified the Company for costs incurred. These indemnification payments from third party payment processor clients in the amount of $3.9 million were recorded as non-interest income during the twelve months ended December 31, 2014. | ||||||||
In October 2013, multiple putative class action lawsuits were filed in United States district courts across the country against a number of different banks based on the Banks' alleged role in "payday lending". Four of these lawsuits, filed in the Northern District of Georgia, the Middle District of North Carolina, the District of Maryland, and the Southern District of Florida, named the Bank as one of the defendants. The lawsuits allege that, by processing Automatic Clearing House transactions indirectly on behalf of "payday" lenders, the Bank is illegally participating in an enterprise to collect unlawful debts and is therefore liable to plaintiffs for damages under the federal Racketeer Influenced and Corrupt Organizations Act. The lawsuits also allege a variety of state law claims. The Bank moved to dismiss each of these lawsuits. As previously reported, the Georgia action was voluntarily dismissed by the plaintiffs. The District of Maryland granted the motion and dismissed the case; the parties subsequently settled while on appeal to the United States Court of Appeals for the Fourth Circuit. Of the two remaining lawsuits, there are no updates to the lawsuit in the Southern District of Florida, which, as previously reported, has been stayed pending arbitration of the plaintiff's claims against the Bank’s co-defendants. The Middle District of North Carolina granted the motion in part and denied it in part; the case is stayed pending resolution of appeal taken by co-defendants. | ||||||||
We are party to certain other legal actions in the ordinary course of our business. We believe these actions are routine in nature and incidental to the operation of our business. While the outcome of these actions cannot be predicted with certainty, management’s present judgment is that the ultimate resolution of these matters will not have a material adverse impact on our business, financial condition, results of operations, cash flows or prospects. If, however, our assessment of these actions is inaccurate, or there are any significant adverse developments in these actions, our business, financial condition, results of operations, cash flows and prospects could be adversely affected. |
FAIR_VALUE_MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS | ||||||||||||||||||||
Fair Value Measured on a Recurring Basis. | |||||||||||||||||||||
The Company measures certain assets at fair value on a recurring basis, as described below. | |||||||||||||||||||||
Investment Securities Available-for-Sale | |||||||||||||||||||||
Investment securities available-for-sale are recorded at fair value on a recurring basis. Fair value measurement is based upon quoted prices, if available. If quoted prices are not available, fair values are measured using independent pricing models or other model-based valuation techniques such as the present value of future cash flows, adjusted for the security’s credit rating, prepayment assumptions and other factors such as credit loss assumptions. Level 1 securities have historically included equity securities traded on an active exchange, such as the New York Stock Exchange. As of December 31, 2014, there were no Level 1 securities. Level 2 securities include taxable municipalities, and mortgage-backed securities issued by government sponsored entities, and certain equity securities. The Company’s mortgage-backed securities were primarily issued by the Government National Mortgage Association (“GNMA”), with additional mortgage-backed securities issued by the Federal National Mortgage Association (“FNMA”) and Federal Home Loan Mortgage Corporation ("FHLMC"). As of December 31, 2014, all of the Company’s mortgage-backed securities were agency issued and designated as Level 2 securities. Securities historically classified as Level 3 include trust preferred securities in less liquid markets; however, as of December 31, 2014, there were no Level 3 securities. | |||||||||||||||||||||
The following table presents information about assets measured at fair value on a recurring basis at December 31, 2014 and 2013 (amounts in thousands): | |||||||||||||||||||||
Description | Fair Value Measurements at | ||||||||||||||||||||
December 31, 2014, Using | |||||||||||||||||||||
Total Carrying | Assets | Quoted Prices | Significant | Significant | |||||||||||||||||
Amount in the | Measured | in Active | Other | Unobservable | |||||||||||||||||
Consolidated | at Fair Value | Markets | Observable | Inputs | |||||||||||||||||
Balance Sheet | for Identical | Inputs | |||||||||||||||||||
Assets | |||||||||||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||
Taxable municipal securities | $ | 17,078 | $ | 17,078 | $ | — | $ | 17,078 | $ | — | |||||||||||
Mortgage-backed securities: | |||||||||||||||||||||
GNMA | 16,264 | 16,264 | — | 16,264 | — | ||||||||||||||||
FNMA & FHLMC | 30,858 | 30,858 | — | 30,858 | — | ||||||||||||||||
Equity securities | 11 | 11 | — | 11 | — | ||||||||||||||||
Total available-for-sale securities | $ | 64,211 | $ | 64,211 | $ | — | $ | 64,211 | $ | — | |||||||||||
Description | Fair Value Measurements at | ||||||||||||||||||||
December 31, 2013 Using | |||||||||||||||||||||
Total Carrying | Assets | Quoted Prices | Significant | Significant | |||||||||||||||||
Amount in the | Measured | in Active | Other | Unobservable | |||||||||||||||||
Consolidated | at Fair Value | Markets | Observable | Inputs | |||||||||||||||||
Balance Sheet | for Identical | Inputs | |||||||||||||||||||
Assets | |||||||||||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||
Taxable municipal securities | $ | 5,933 | $ | 5,933 | $ | — | $ | 5,933 | $ | — | |||||||||||
Mortgage-backed securities: | |||||||||||||||||||||
GNMA | 25,477 | 25,477 | — | 25,477 | — | ||||||||||||||||
Trust preferred securities | 1,025 | 1,025 | — | — | 1,025 | ||||||||||||||||
Equity securities | 131 | 131 | 70 | 61 | — | ||||||||||||||||
Total available-for-sale securities | $ | 32,566 | $ | 32,566 | $ | 70 | $ | 31,471 | $ | 1,025 | |||||||||||
The table below presents reconciliation for the years ended December 31, 2014 and 2013 for all Level 3 assets that are measured at fair value on a recurring basis (amounts in thousands). During the year ended December 31, 2014, no securities were transferred from Level 3 to Level 2. | |||||||||||||||||||||
Available-for-Sale Securities | |||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
Beginning Balance | $ | 1,025 | $ | 1,006 | |||||||||||||||||
Total realized and unrealized gains or (losses): | |||||||||||||||||||||
Included in earnings | 250 | — | |||||||||||||||||||
Included in other comprehensive income | 150 | 19 | |||||||||||||||||||
Purchases, issuances and settlements | (1,425 | ) | — | ||||||||||||||||||
Ending Balance | $ | — | $ | 1,025 | |||||||||||||||||
Fair Value Measured on a Nonrecurring Basis. | |||||||||||||||||||||
The Company measures certain assets at fair value on a nonrecurring basis, as described below. | |||||||||||||||||||||
Loans Held for Sale | |||||||||||||||||||||
Loans held for sale are carried at the lower of cost or market value. The fair value of loans held for sale is based on what secondary markets are currently offering for portfolios with similar characteristics. As such, the Company classifies loans held for sale as a Level 2 valuation. | |||||||||||||||||||||
At December 31, 2014, the Company had $2.9 million in loans held for sale which included $335,000 in residential mortgage loans held for sale in the secondary market and $2.5 million in other loans for sale that were transferred from loans held for investment during 2014. These loans were transferred to held for sale and are being carried at fair value in anticipation of near term loan sales resulting from the Asset Resolution Plan. There were no loans held for sale as of December 31, 2013. | |||||||||||||||||||||
Impaired Loans | |||||||||||||||||||||
The Company does not record loans at fair value on a recurring basis. However, when a loan is considered impaired, it is evaluated for impairment and written down to its estimated fair value or an allowance for loan losses is established. When the fair value of an impaired loan is based on an observable market price or a current appraised value with no adjustments, the Company records the impaired loan as nonrecurring Level 2. When there is no observable market prices, an appraised value is not available, or the Company determines the fair value of the collateral is further impaired below the appraised value, the impaired loan is classified as nonrecurring Level 3. | |||||||||||||||||||||
As of December 31, 2014, the Bank identified $10.4 million in impaired loans that were carried at fair value which included $1.6 million in loans that required a specific valuation allowance of $524,000 and an additional $8.8 million in loans without a specific valuation allowance that have previously been written down to fair value. As of December 31, 2013, the Bank identified $20.1 million in impaired loans that were carried at fair value which included $7.8 million in loans that required a specific valuation allowance of $1.8 million and an additional $12.3 million in loans without a specific valuation allowance that have previously been written down to fair value. | |||||||||||||||||||||
Foreclosed Assets | |||||||||||||||||||||
Foreclosed assets are adjusted to fair value less estimated selling costs upon transfer of the loans to foreclosed assets. Subsequently, foreclosed assets are carried at the lower of carrying value or fair value. Fair value is based upon independent market prices, appraised values of the collateral or management’s estimation of the value of the collateral. Given the lack of observable market prices for identical properties, the Company records foreclosed assets as non-recurring Level 3. At December 31, 2014, there were $1.8 million of fair value adjustments required after transfer related to foreclosed real estate of $3.8 million compared to $1.6 million and $8.5 million respectively at December 31, 2013. | |||||||||||||||||||||
Assets measured at fair value on a non-recurring basis are included in the table below at December 31, 2014 and 2013 (amounts in thousands): | |||||||||||||||||||||
Fair Value Measurements at | |||||||||||||||||||||
December 31, 2014, Using | |||||||||||||||||||||
Description | Total Carrying Amount in the Consolidated Balance Sheet | Assets Measured at Fair Value | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs | Significant Unobservable Inputs | ||||||||||||||||
(Level 2) | (Level 3) | ||||||||||||||||||||
Loans held for sale | $ | 2,882 | $ | 2,882 | $ | — | $ | 2,882 | $ | — | |||||||||||
Impaired loans | $ | 9,855 | $ | 9,855 | $ | — | $ | — | $ | 9,855 | |||||||||||
Foreclosed assets | $ | 3,782 | $ | 3,782 | $ | — | $ | — | $ | 3,782 | |||||||||||
Fair Value Measurements at | |||||||||||||||||||||
December 31, 2013, Using | |||||||||||||||||||||
Description | Total Carrying Amount in the Consolidated Balance Sheet | Assets Measured at Fair Value | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs | Significant Unobservable Inputs | ||||||||||||||||
(Level 2) | (Level 3) | ||||||||||||||||||||
Impaired loans | $ | 18,215 | $ | 18,215 | $ | — | $ | — | $ | 18,215 | |||||||||||
Foreclosed assets | $ | 8,502 | $ | 8,502 | $ | — | $ | — | $ | 8,502 | |||||||||||
Quantitative Information about Level 3 Fair Value Measurements | |||||||||||||||||||||
The following table presents the valuation methodology and unobservable inputs for Level 3 assets measured at fair value on a nonrecurring basis at December 31, 2014 (amounts in thousands, except percentages): | |||||||||||||||||||||
Total Carrying Amount at December 31, 2014 | Valuation Methodology | Range of Inputs | |||||||||||||||||||
Nonrecurring measurements: | |||||||||||||||||||||
Impaired loans | $ | 9,855 | Collateral discounts | 9 - 50% | |||||||||||||||||
Foreclosed assets | $ | 3,782 | Discounted appraisals | 10 - 30% | |||||||||||||||||
Collateral discounts to determine fair value on impaired loans varies widely and result from the consideration of the following factors: the age of the most recent appraisal (i.e. an appraisal dating from an earlier period of real estate speculation could require as much as a 50% discount), the type of asset serving as collateral, the expected marketability of the asset, its material or environmental condition, and comparisons to actual sales data of similar assets from both internal and external sources. | |||||||||||||||||||||
The following table reflects the general range of collateral discounts for impaired loans by segment: | |||||||||||||||||||||
Loan Segment: | Range of Percentages | ||||||||||||||||||||
Commercial construction and land development | 10.5% - 40% | ||||||||||||||||||||
Commercial real estate other | 12.5% - 50% | ||||||||||||||||||||
Residential construction | 9% - 30% | ||||||||||||||||||||
Residential mortgage | 9% - 20% | ||||||||||||||||||||
All other segments | 9% - 20% | ||||||||||||||||||||
As foreclosed assets are brought into other real estate owned through a process which requires a fair market valuation, further discounts typically reflect market conditions specific to the asset. These conditions are usually captured in subsequent appraisals which are required on an annual basis, and depending upon asset type and marketability demonstrate a more restrained variance than that noted above. | |||||||||||||||||||||
Fair Value of Financial Instruments | |||||||||||||||||||||
The following methods and assumptions were used to estimate the fair value of each class of financial instrument. | |||||||||||||||||||||
Cash and Cash Equivalents | |||||||||||||||||||||
The carrying amounts of cash and cash equivalents are equal to the fair value due to the liquid nature of the financial instruments. | |||||||||||||||||||||
Certificates of Deposit | |||||||||||||||||||||
These investments are valued at carrying amounts for fair value purposes. | |||||||||||||||||||||
Securities Available-for-Sale and Securities Held-to-Maturity | |||||||||||||||||||||
Fair values of investment securities are based on quoted market prices. If a quoted market price is not available, fair value is estimated using quoted market prices for similar securities. | |||||||||||||||||||||
Loans Held For Sale | |||||||||||||||||||||
The fair value of mortgage loans held for sale is based on commitments on hand from investors within the secondary market for loans with similar characteristics. | |||||||||||||||||||||
Loans | |||||||||||||||||||||
The fair value of loans has been estimated utilizing the net present value of future cash flows based upon contractual balances, prepayment assumptions, and applicable weighted average interest rates, adjusted for a 5% current liquidity and market discount assumption. The Company has assigned no fair value to off-balance sheet financial instruments since they are either short term in nature or subject to immediate repricing. | |||||||||||||||||||||
FHLB Stock | |||||||||||||||||||||
The carrying amount of FHLB stock approximates fair value. | |||||||||||||||||||||
Premises and Equipment, Held for Sale | |||||||||||||||||||||
The carrying amount of premises and equipment held for sale approximates fair value. | |||||||||||||||||||||
Deposits | |||||||||||||||||||||
The fair value of non-maturing deposits such as noninterest-bearing demand, money market, NOW, and savings accounts, are by definition, equal to the amount payable on demand. Fair value for maturing deposits such as CDs and IRAs are estimated using a discounted cash flow approach that applies current interest rates to expected maturities. | |||||||||||||||||||||
Borrowings, Subordinated Debentures, and Subordinated Promissory Notes | |||||||||||||||||||||
The fair value of borrowings, subordinated debentures, and subordinated promissory notes, is based on discounting expected cash flows at the interest rate from debt with the same or similar remaining maturities and collection requirements. | |||||||||||||||||||||
Accrued Interest Receivable and Payable | |||||||||||||||||||||
The carrying amounts of accrued interest approximates fair value. | |||||||||||||||||||||
The following table presents information for financial assets and liabilities as of December 31, 2014 and 2013 (amounts in thousands): | |||||||||||||||||||||
December 31, 2014 | |||||||||||||||||||||
Carrying | Estimated | Level 1 | Level 2 | Level 3 | |||||||||||||||||
Value | Fair Value | ||||||||||||||||||||
Financial assets: | |||||||||||||||||||||
Cash and cash equivalents | $ | 158,527 | $ | 158,527 | $ | 158,527 | $ | — | $ | — | |||||||||||
Certificates of deposit | 27,784 | 27,784 | — | 27,784 | — | ||||||||||||||||
Securities available for sale | 64,211 | 64,211 | — | 64,211 | — | ||||||||||||||||
Securities held to maturity | 81,583 | 82,242 | — | 82,242 | — | ||||||||||||||||
Loans held for sale | 2,882 | 2,882 | — | 2,882 | — | ||||||||||||||||
Loans, net | 442,879 | 422,906 | — | — | 422,906 | ||||||||||||||||
FHLB stock | 4,788 | 4,788 | — | 4,788 | — | ||||||||||||||||
Accrued interest receivable | 1,627 | 1,627 | — | 1,627 | — | ||||||||||||||||
Financial liabilities: | |||||||||||||||||||||
Deposits | $ | 661,185 | $ | 663,000 | $ | — | $ | 663,000 | $ | — | |||||||||||
Subordinated debentures and subordinated promissory notes | 24,372 | 25,671 | — | — | 25,671 | ||||||||||||||||
Borrowings | 90,000 | 95,573 | — | 95,573 | — | ||||||||||||||||
Accrued interest payable | 1,704 | 1,704 | — | 1,704 | — | ||||||||||||||||
December 31, 2013 | |||||||||||||||||||||
Carrying | Estimated | Level 1 | Level 2 | Level 3 | |||||||||||||||||
Value | Fair Value | ||||||||||||||||||||
Financial assets: | |||||||||||||||||||||
Cash and cash equivalents | $ | 128,629 | $ | 128,629 | $ | 128,629 | $ | — | $ | — | |||||||||||
Certificates of deposit | 31,850 | 31,850 | — | 31,850 | — | ||||||||||||||||
Securities available for sale | 32,566 | 32,566 | 70 | 31,471 | 1,025 | ||||||||||||||||
Securities held to maturity | 98,013 | 95,831 | — | 95,831 | — | ||||||||||||||||
Loans, net | 481,122 | 458,254 | — | — | 458,254 | ||||||||||||||||
FHLB stock | 6,076 | 6,076 | — | 6,076 | — | ||||||||||||||||
Accrued interest receivable | 1,576 | 1,576 | — | 1,576 | — | ||||||||||||||||
Financial liabilities: | |||||||||||||||||||||
Deposits | $ | 657,620 | $ | 659,733 | $ | — | $ | 659,733 | $ | — | |||||||||||
Subordinated debentures and subordinated promissory notes | 24,372 | 24,369 | — | — | 24,369 | ||||||||||||||||
Borrowings | 112,000 | 121,519 | — | 121,519 | — | ||||||||||||||||
Accrued interest payable | 1,642 | 1,642 | — | 1,642 | — | ||||||||||||||||
STOCK_OPTION_PLAN
STOCK OPTION PLAN | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||
STOCK OPTION PLAN | STOCK OPTION PLAN | ||||||||||||
The Company has a non-qualified stock option plan for certain key employees under which it is authorized to issue options for up to 1,542,773 shares of common stock. Options are granted at the discretion of the Company’s Board of Directors at an exercise price approximating market value, as determined by a committee of Board members. All options granted subsequent to a 1997 amendment will be 100% vested after either one or two years from the grant date and will expire after such a period as is determined by the Board at the time of grant. Options granted in 2013 and 2014 have a two year vesting provision. | |||||||||||||
A summary of option activity under the Plan for the year ended December 31, 2014, is presented below: | |||||||||||||
Shares | Option | Weighted | Aggregate | ||||||||||
Price Per | Average | Intrinsic | |||||||||||
Share | Remaining | Value | |||||||||||
Contractual | |||||||||||||
Term | |||||||||||||
Outstanding at January 1, 2014 | 301,705 | $ | 5.99 | ||||||||||
Issued | 54,375 | 1.7 | |||||||||||
Exercised | — | — | |||||||||||
Forfeited | 29,723 | 4.46 | |||||||||||
Expired | 47,775 | 8.64 | |||||||||||
Balance at December 31, 2014 | 278,582 | $ | 4.86 | 2.15 | $ | 18,935 | |||||||
Exercisable at December 31, 2014 | 174,026 | $ | 6.92 | 1.23 | $ | — | |||||||
The weighted average exercise price of all exercisable options at December 31, 2014 is $6.92. There were 214,845 shares reserved for future issuance under the Company’s stock option plan at December 31, 2014. | |||||||||||||
A summary of the status of the Company's non-vested options as of December 31, 2014 and changes during the year then ended is presented below: | |||||||||||||
Shares | Weighted average grant date fair value | ||||||||||||
Non-vested - December 31, 2013 | 111,656 | $ | 0.78 | ||||||||||
Granted | 53,350 | 1.03 | |||||||||||
Vested | 4,825 | 0.69 | |||||||||||
Forfeited/Expired | 55,625 | 0.87 | |||||||||||
Non-vested - December 31, 2014 | 104,556 | $ | 0.86 | ||||||||||
As of December 31, 2014 and 2013, there was $42,016 and $39,908 of unrecognized compensation cost related to non-vested share-based compensation arrangements, respectively. | |||||||||||||
Additional information concerning the Company’s stock options at December 31, 2014 is as follows: | |||||||||||||
Exercise Price | Number | Contractual | Number | ||||||||||
Outstanding | Life (Years) | Exercisable | |||||||||||
1.15-1.69 | 51,175 | 3.19 | — | ||||||||||
1.70 - 2.99 | 101,975 | 3.2 | 48,623 | ||||||||||
3.00 - 5.49 | 46,175 | 1.16 | 46,173 | ||||||||||
5.50 - 10.91 | 46,175 | 0.15 | 46,151 | ||||||||||
10.92 - 40.78 | 20,777 | 0.55 | 20,774 | ||||||||||
40.79 | 12,305 | 3.07 | 12,305 | ||||||||||
278,582 | 2.15 | 174,026 | |||||||||||
The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model with the following assumptions used for grants in 2014 and 2013: | |||||||||||||
2014 | 2013 | ||||||||||||
Dividend yield | 0 | % | 0 | % | |||||||||
Expected volatility | 73.31 | % | 73.3 | % | |||||||||
Risk free interest rate | 1.57 | % | 0.9 | % | |||||||||
Expected life | 5 years | 5 years | |||||||||||
The weighted average fair value of options granted during 2014 and 2013, was $1.03 and $0.69, respectively. |
OTHER_EMPLOYEE_BENEFITS
OTHER EMPLOYEE BENEFITS | 12 Months Ended |
Dec. 31, 2014 | |
Compensation and Retirement Disclosure [Abstract] | |
OTHER EMPLOYEE BENEFITS | OTHER EMPLOYEE BENEFITS |
Supplemental Retirement | |
In 1998, the Bank adopted a Supplemental Executive Retirement Plan (“SERP”) for its president. The Company has purchased life insurance policies in order to provide future funding of benefit payments. SERP benefits will accrue and vest during the period of employment and will be paid in annual benefit payments over the officer’s remaining life commencing with the officer’s retirement. The liability accrued under the SERP plan amounts to $477,000 and $481,000 at December 31, 2014 and 2013, respectively. During 2014 and 2013, the expense attributable to the SERP amounted to $0 and $61,000 respectively. The reduction in the accrued liability during 2014 was due to a change in the valuation of expected benefit payments. | |
Employment Agreements | |
The Company has entered into employment agreements with certain of its executive officers to ensure a stable and competent management base. The agreements provide for benefits as spelled out in the contracts and cannot be terminated by the Company’s Board of Directors, except for cause, without prejudicing the officers’ rights to receive certain vested rights, including compensation. In addition, the Company has entered into severance compensation agreements with certain of its executive officers and key employees to provide them with severance pay benefits in the event of a change in control of the Company, as outlined in the agreements; the acquirer will be bound to the terms of the contracts. | |
Defined Contribution Plan | |
The Company sponsors a contributory profit-sharing plan in effect for substantially all employees. Participants may make voluntary contributions resulting in salary deferrals in accordance with Section 401(k) of the Internal Revenue Code of 1986, as amended (the “Code”). The plans provide for employee contributions up to $17,500 of the participant's annual salary and an employer contribution of 25% matching of the first 6% of pre-tax salary contributed by each participant. Expenses related to these plans for the years ended December 31, 2014 and 2013 were $76,000 and $77,000, respectively. Contributions under the plan are made at the discretion of the Company’s Board of Directors. | |
Employee Stock Ownership Plan | |
The Company terminated the Employee Stock Ownership Plan (the "ESOP") on April 8, 2014 (the "Termination Date"). As a result, the accounts of all participants in the ESOP became 100% vested as of the Termination Date. Each participate received a distribution of 100% of his or her account at no cost to the participant. The cost to the Company was immaterial. | |
Employee Stock Purchase and Bonus Plan | |
The Employee Stock Purchase and Bonus Plan (the “Purchase Plan”) is a voluntary plan that enables full-time employees of the Company and its subsidiaries to purchase shares of the Company’s common stock. The Purchase Plan is administered by a committee of the Board of Directors, which has broad discretionary authority to administer the Purchase Plan. The Company’s Board of Directors may amend or terminate the Purchase Plan at any time. The Purchase Plan is not intended to be qualified as an employee stock purchase plan under Section 423 of the Code. | |
Once a year, participants in the Purchase Plan purchase the Company’s common stock at fair market value. Participants are permitted to purchase shares under the Purchase Plan up to five percent (5%) of their compensation, with a maximum purchase amount of $1,000 per year. The Company matches, in cash, fifty percent (50%) of the amount of each participant’s purchase, up to $500. After withholding for income and employment taxes, participants use the balance of the Company’s matching grant to purchase shares of the Company’s common stock. | |
As of December 31, 2014, 118,000 shares of the Company’s common stock had been reserved for future issuance under the Purchase Plan, and 401,000 total shares had been purchased to date. During the year ended December 31, 2013, 76,000 shares were purchased under the Purchase Plan. There were no shares purchased in 2014. | |
Sick Leave Plan | |
The Company allows employees to accrue up to 60 days of sick leave that can be carried forward from one year to the next. Employees with 10 consecutive years of service who retire after age 55 are paid for unused sick leave up to a maximum of 60 days. As of December 31, 2014 and 2013, the Company maintained an accrued liability for future obligations in the amount of $562,000 and $521,000, respectively. Future obligations under the plan are assessed on an annual basis. Deferred compensation expenses under the plan totaled $82,000 and $41,000 for 2014 and 2013, respectively. Cash benefits paid to retiring employees totaled $40,000 and $54,000 for 2014 and 2013, respectively. |
LEASES
LEASES | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Leases [Abstract] | ||||
LEASES | LEASES | |||
The Company has entered into non-cancelable operating leases for six facilities. Future minimum lease payments under the leases for future years are as follows (amounts in thousands): | ||||
Leases | ||||
2015 | $ | 350 | ||
2016 | 284 | |||
2017 | 232 | |||
2018 | 185 | |||
2019 | 178 | |||
2020 and beyond | 449 | |||
$ | 1,678 | |||
Total rental expense under operating leases for the years ended December 31, 2014 and 2013 amounted to $327,000 and $306,000, respectively. |
PARENT_COMPANY_FINANCIAL_INFOR
PARENT COMPANY FINANCIAL INFORMATION | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | ||||||||
PARENT COMPANY FINANCIAL INFORMATION | PARENT COMPANY FINANCIAL INFORMATION | |||||||
Condensed financial information of Four Oaks Fincorp, Inc. at December 31, 2014 and 2013, and for the years ended December 31, 2014 and 2013 is presented below (amounts in thousands): | ||||||||
Condensed Balance Sheets | 2014 | 2013 | ||||||
Assets: | ||||||||
Cash and cash equivalents | $ | 3,958 | $ | 456 | ||||
Equity investment in subsidiaries | 61,937 | 44,925 | ||||||
Investment securities available-for-sale | 11 | 1,156 | ||||||
Other assets | 131 | 195 | ||||||
Total assets | $ | 66,037 | $ | 46,732 | ||||
Liabilities and Shareholders’ Equity: | ||||||||
Other liabilities | $ | 936 | $ | 737 | ||||
Subordinated debentures | 12,372 | 12,372 | ||||||
Subordinated promissory notes | 12,000 | 12,000 | ||||||
Shareholders' equity | 40,729 | 21,623 | ||||||
Total liabilities and shareholders’ equity | $ | 66,037 | $ | 46,732 | ||||
For the Years Ended December 31, | ||||||||
Condensed Statements of Operations | 2014 | 2013 | ||||||
Equity in undistributed (loss) income of subsidiaries | $ | (3,128 | ) | $ | 899 | |||
Interest income | 5 | 2 | ||||||
Gain on sale of investments, available-for-sale | 109 | — | ||||||
Recovery of impairment loss on investment securities available-for-sale | 189 | — | ||||||
Other income | 20 | 87 | ||||||
Other expenses | (1,384 | ) | (1,338 | ) | ||||
Net loss | $ | (4,189 | ) | $ | (350 | ) | ||
Condensed Statements of Cash Flows | 2014 | 2013 | ||||||
Operating activities: | ||||||||
Net loss | $ | (4,189 | ) | $ | (350 | ) | ||
Equity in undistributed loss of subsidiaries | 3,128 | (899 | ) | |||||
Gain on sale of investments | (298 | ) | — | |||||
Increase in other assets | 16 | 427 | ||||||
Increase in other liabilities | 199 | 203 | ||||||
Net cash used in operating activities | (1,144 | ) | (619 | ) | ||||
Investing activities: | ||||||||
Investment in subsidiaries | (19,157 | ) | — | |||||
Sales and maturities of securities | 1,560 | 72 | ||||||
Net cash used in investing activities | (17,597 | ) | 72 | |||||
Financing activities: | ||||||||
Proceeds from issuance of common stock | 22,243 | 219 | ||||||
Net cash provided by financing activities | 22,243 | 219 | ||||||
Net increase (decrease) in cash and cash equivalents | 3,502 | (328 | ) | |||||
Cash and cash equivalents, beginning of year | 456 | 784 | ||||||
Cash and cash equivalents, end of year | $ | 3,958 | $ | 456 | ||||
SECURITIES_PURCHASE_AGREEMENT
SECURITIES PURCHASE AGREEMENT | 12 Months Ended |
Dec. 31, 2014 | |
Equity [Abstract] | |
SECURITIES PURCHASE AGREEMENT | SECURITIES PURCHASE AGREEMENT |
On March 24, 2014, the Company entered into the Securities Purchase Agreement with Kenneth R. Lehman, a private investor (the “Standby Investor”). Pursuant to the Securities Purchase Agreement, the Standby Investor agreed to purchase from the Company (the “Standby Offering”), for $1.00 per share, the lesser of (i) 10,000,000 shares of common stock, (ii) if the Rights Offering (as defined below) is completed, all shares of common stock not purchased by shareholders exercising their basic subscription privilege, and (iii) the maximum number of shares that he may purchase without causing an “ownership change” under Section 382(g) of the Code (49.99% of all shares of common stock outstanding at the completion of the Rights Offering and the Standby Offering). In addition, the Securities Purchase Agreement provided the Standby Investor a right of first refusal to purchase an additional 6,000,000 shares subject to the limitations outlined in clauses (ii) and (iii) above. | |
Pursuant to the Securities Purchase Agreement, on March 27, 2014, the Company closed the initial sale of 875,000 shares of common stock to the Standby Investor and on August 15, 2014, a subsequent closing of the remaining number of shares based on the formula above and the Standby Investor's decision to exercise his right of first refusal occurred, contemporaneous with the completion of the Rights Offering (as defined below), at which the Standby Investor purchased an additional 12,500,000 shares (not including shares purchased from the Rights Offering). | |
The Securities Purchase Agreement contains customary representations, warranties, and various covenants, including, among others, covenants by the Company to (i) adopt a restricted stock plan for the benefit of the Company’s officers, (ii) adopt an asset resolution plan, and (iii) establish a rights plan to protect the Company’s deferred tax asset. Consummation of the Standby Offering was subject to (a) receipt of required regulatory approvals and non-objections, (b) receipt by the Company of a letter from an independent accounting firm related to the Company’s deferred tax asset, and (c) other customary closing conditions set forth in the Securities Purchase Agreement. At the closing of the Standby Offering, the Company entered into a registration rights agreement with the Standby Investor (the “Registration Rights Agreement”), which provides the Standby Investor demand registration and piggyback registration rights with respect to the Standby Investor’s resale of shares purchased under the Securities Purchase Agreement, subject to customary limitations. The Company agreed to pay the expenses associated with any registration statements filed with the Securities and Exchange Commission pursuant to the Registration Rights Agreement. Between the closing of the Standby Offering and the third anniversary of the closing date, for as long as the Standby Investor owns at least 25% of the Company’s outstanding shares of common stock, if the Company makes any public or non-public offering of any equity or any securities, options, or debt that are convertible or exchangeable into equity or that include an equity component, the Standby Investor will be afforded the opportunity to acquire from the Company for the same price and on the same terms as such securities are proposed to be offered to others, up to the amount in the aggregate required to enable him to maintain his proportionate common stock-equivalent interest in the Company. | |
In addition, on June 18, 2014, the Company commenced its previously announced rights offering of up to approximately $26.6 million (the “Rights Offering”). In the Rights Offering, the Company distributed, at no charge, non-transferable subscription rights to its shareholders as of 5:00 p.m., Eastern Time, on June 16, 2016 (the "Record Date"). For each share of common stock held as of the Record Date, each shareholder received a non-transferable right to purchase three shares of common stock at a subscription price of $1.00 per share (the “Basic Subscription Privilege”). Shareholders who exercised their Basic Subscription Privilege in full had the opportunity to subscribe for additional shares for pro rata allocation in the event that not all available shares are purchased pursuant to the Basic Subscription Privilege or by the Standby Investor pursuant to the Securities Purchase Agreement (the "Oversubscription Privilege"), subject to certain limitations. | |
The subscription period of the Rights Offering expired at 5:00 p.m., Eastern Time, on July 31, 2014 and the Right Offering closed on August 15, 2014. In connection with the closing of the Rights Offering, the Company issued 9,248,464 shares to holders upon exercise of their Basic Subscription Privilege (including 2,625,000 shares issued to the Standby Investor) and 1,376,536 shares were issued to holders upon exercise of their Oversubscription Privilege. In the Rights Offering and Standby Offer combined, the Company issued an aggregate of 24,000,000 shares of common stock at $1.00 per share for aggregate gross proceeds of $24.0 million. |
ORGANIZATION_AND_SUMMARY_OF_SI1
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation |
The consolidated financial statements include the accounts and transactions of the Company, a bank holding company incorporated under the laws of the State of North Carolina, and its wholly-owned subsidiaries, the Bank, and Four Oaks Mortgage Services, L.L.C., which became inactive on September 30, 2012. All significant intercompany transactions have been eliminated. In March 2006, the Company formed Four Oaks Statutory Trust I, a wholly owned Delaware statutory business trust (the “Trust”), for the sole purpose of issuing Trust Preferred Securities (as defined in Note I - Trust Preferred Securities). The Trust is not included in the consolidated financial statements of the Company. | |
Certain amounts previously presented in our Consolidated Financial Statements for the prior periods have been reclassified to conform to current classifications. All such reclassifications had no impact on the prior period's Statements of Operations, Comprehensive Income (Loss, or Shareholders' Equity as previously reported. | |
Use of Estimates | Use of Estimates |
Preparing consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for loan losses, fair value of impaired loans, fair value of foreclosed assets, other than temporary impairment of investment securities available-for-sale and held-to-maturity, and the valuation allowance against deferred tax assets. | |
Cash and Cash Equivalents | Cash and Cash Equivalents |
For the purpose of presentation in the consolidated statements of cash flows, cash and cash equivalents are defined as those amounts included in the balance sheet captions cash and due from banks, and interest-earning deposits. | |
Federal regulations require institutions to set aside specified amounts of cash as reserves against transactions and time deposits. | |
Investment Securities | Investment Securities |
Investment securities are classified into three categories: | |
(1) Held-to-Maturity - Debt securities that the Company has the positive intent and the ability to hold to maturity are classified as held-to-maturity and reported at amortized cost. | |
(2) Trading - Debt and equity securities that are bought and held principally for the purpose of selling them in the near term are classified as trading securities and reported at fair value, with unrealized gains and losses included in earnings. | |
(3) Available-for-Sale - Debt and equity securities not classified as either securities held-to-maturity or trading securities are reported at fair value, with unrealized gains and losses excluded from earnings and reported, net of income taxes, as other comprehensive income, a separate component of shareholders' equity. Gains and losses on sales of securities, computed based on specific identification of adjusted cost of each security, are included in income at the time of the sale. Premiums and discounts are amortized into interest income using a method that approximates the interest method over the period to maturity. | |
Transfers of securities into held-to-maturity from available-for-sale are made at fair value as of the transfer date. The unrealized gain or loss as of the transfer date is retained in accumulated other comprehensive income and in the carrying value of the held-to-maturity securities. The unrealized gain or loss is then amortized over the remaining life of the securities. | |
Other Than Temporary Impairment | Each investment security in a loss position is evaluated for other-than-temporary impairment on at least a quarterly basis. The review includes an analysis of the facts and circumstances of each individual investment such as: (1) the length of time and the extent to which the fair value has been below cost, (2) changes in the earnings performance, credit rating, asset quality, or business prospects of the issuer, (3) the ability of the issuer to make principal and interest payments, (4) changes in the regulatory, economic, or technological environment of the issuer, and (5) changes in the general market condition of either the geographic area or industry in which the issuer operates. |
Regardless of these factors, if we have developed a plan to sell the security or it is likely that we will be forced to sell the security in the near future, then the impairment is considered other-than-temporary and the carrying value of the security is permanently written down to the current fair value with the difference between the new carrying value and the amortized cost charged to earnings. If we do not intend to sell the security and it is not more likely than not that we will be required to sell the security before recovery of its amortized cost basis less any current period credit loss, the other-than-temporary impairment is separated into the following: (1) the amount representing the credit loss and (2) the amount related to all other factors. The amount of the total other-than- temporary impairment related to the credit loss is recognized in earnings and the amount of the total other-than-temporary impairment related to other factors is recognized in other comprehensive income, net of applicable taxes. | |
Loans Held for Sale | Loans Held for Sale |
As part of the asset resolution plan (the "Asset Resolution Plan") executed during 2014, the Company transferred $10.1 million of loans held for investment to loans held for sale in anticipation of near term loan sales. Other loans held for sale generally represent single-family, residential first mortgage loans on a pre-sold basis originated by our mortgage division. Commitments to sell the residential first mortgage loans are made after the intent to proceed with mortgage applications are initiated with borrowers, and all necessary components of the loan are approved according to secondary market underwriting standards of the investor that purchases the loan. Upon closing, these loans, together with their servicing rights, are sold to mortgage loan investors under prearranged terms. Loans held for sale are measured at the lower of cost or fair value on an aggregated basis within the consolidated balance sheet under the caption “loans held for sale”. | |
Rate Lock Commitments | Rate Lock Commitments |
The Company enters into commitments to originate loans whereby the interest rate on the loan is determined prior to funding (rate lock commitments). As required by Accounting Standard Codification ("ASC") ASC 815, Derivatives and Hedging, rate lock commitments related to the origination of mortgage loans held for sale and the corresponding forward loan sale commitments are considered to be derivatives. The commitments are generally for periods of 60 days and are at market rates. | |
In order to mitigate the risk from interest rate fluctuations, the Company enters into forward loan sale commitments on a “best efforts” basis while the loan is in the pipeline. Interest rate lock commitments and forward sales commitments are not material to the financial statements for any period presented. | |
Loans, Allowance for Loan Losses and Foreclosed Asset | Foreclosed Assets |
Assets acquired as a result of foreclosure are valued at fair value, less estimated selling costs, at the date of foreclosure establishing a new cost basis. After foreclosure, valuations of the property are periodically performed by management and the assets are carried at the lower of cost or fair value minus estimated costs to sell. Losses from the acquisition of property in full or partial satisfaction of debt are treated as credit losses. Routine holding costs, subsequent declines in value, and gains or losses on disposition are included in other income and expense. | |
Loans | |
Loans are stated at the amount of unpaid principal, reduced by an allowance for loan losses. Interest on all loan classifications is calculated by using the simple interest method on daily balances of the principal amount outstanding. | |
Loan origination fees are deferred, as well as certain direct loan origination costs. Such costs and fees are recognized as an adjustment to yield over the contractual lives of the related loans utilizing the interest method. | |
For all classes of loans, a loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect full repayment of all principal and accrued interest when due either under the terms of the original loan agreement or within reasonably modified contractual terms. Once a loan has been determined to meet the definition of impairment, the amount of that impairment is measured through one of the following methods; a calculation of the net present value of the expected future cash flows of the loan discounted by the effective interest rate of the loan or by determining the fair market value of the underlying collateral securing the loan. If a deficit is calculated, the amount of the measured impairment results in the establishment of a specific valuation allowance or charge-off, and is incorporated into the Bank's allowance for loan and lease losses. Groups of small dollar impaired loans with similar risk characteristics are evaluated for impairment collectively. | |
Allowance for Loan Losses | |
The allowance for loan losses is established through periodic charges to earnings in the form of a provision for loan losses. Increases to the allowance for loan losses occur as a result of provisions charged to operations and recoveries of amounts previously charged-off, and decreases to the allowance occur when loans are charged-off because management believes that the uncollectibility of a loan balance is confirmed. Management evaluates the adequacy of our allowance for loan losses on at least a quarterly basis. The evaluation of the adequacy of the allowance for loan losses involves the consideration of loan growth, loan portfolio composition and industry diversification, historical loan loss experience, current delinquency levels, adverse conditions that might affect a borrower’s ability to repay the loan, estimated value of underlying collateral, prevailing economic conditions and all other relevant factors derived from our history of operations. Additionally, regulatory agencies review our allowance for loan losses and may require additional provisions for estimated losses based on judgments that differ from those of management. | |
Management has developed a model for evaluating the adequacy of the allowance for loan losses. The model uses the Company’s internal grading system to quantify the risk of each loan. The grade is initially assigned by the lending officer and/or the credit administration function. The internal grading system is reviewed and tested periodically by an independent internal loan review function as well as an independent external credit review firm. The testing process involves the evaluation of a sample of new loans, loans having been identified as possessing potential weakness in credit quality, and past due and nonaccrual loans to determine the ongoing effectiveness of the internal grading system. In addition, various regulatory agencies, as an integral part of their examination process, periodically review the Company's allowance for loan losses. Such agencies may require us to recognize adjustments to the allowance based on their judgments of information available to them at the time of their examination. | |
The grading system is comprised of seven risk categories for active loans. Grades 1 through 4 demonstrate various degrees of risk, but each is considered to have the capacity to perform in accordance with the terms of the loan. Loans possessing a grade of 5 exhibit characteristics which indicate higher risk that the loan may not be able to perform in accordance with the terms of the loan. Grade 6 loans are considered substandard and are generally impaired. Grade 7 loans are considered doubtful and would be included in nonaccrual loans. Loans can also be classified as non-accrual, TDR, or otherwise impaired, all of which are considered impaired. | |
Once a loan has been determined to meet the definition of impairment, the amount of that impairment is measured through one of the following methods: a calculation of the net present value of the expected future cash flows of the loan discounted by the effective interest rate of the loan or by determining the fair market value of the underlying collateral securing the loan. If the fair value market value of collateral method is selected for use, an updated collateral value is generally obtained based on where the loan is in the collection process and the age of the existing appraisal. Groups of small dollar impaired loans with similar risk characteristics are evaluated for impairment collectively. Other impaired loans are then analyzed individually to determine the net value of collateral or cash flows and an estimate of potential loss. The net value of collateral per our analysis is determined using various subjective discounts, selling expenses and a review of the assumptions used to generate the current appraisal. If collection is deemed to be collateral dependent then the deficiency is generally charged off. Appraised values on real estate collateral are subject to constant change and management makes certain assumptions about how the age of an appraisal impacts current value. Impaired loans are re-evaluated periodically to determine the adequacy of specific reserves and charge-offs. | |
Loans that are not assessed for specific reserves under FASB ASC 310-10 are reserved for under FASB ASC 450. The loans analyzed under FASB ASC 450 are assigned a reserve based on a quantitative factor and a qualitative factor. The quantitative factor is based on historical charge-off levels for each call report category and is adjusted for the loan's risk grade. The qualitative factors address loan growth, loan portfolio composition and industry diversification, historical loan loss experience, current delinquency levels, prevailing economic conditions and all other relevant factors derived from our history of operations. Together these two components comprise the ASC 450, or general, reserve. | |
The Bank determines the quantitative ASC 450 reserve using a charge-off metric of the greater of (i) the charge-off rate from the most recent 8 quarters (rolling two years) or (ii) the charge-off rate from the most recent 12 quarters (rolling three years). This provides for the highest base charge-off rate regardless of whether the historical charge-offs are improving or declining. In addition, the Bank assigns a different percentage ("multiplier") of the base charge-off rate to the balances for each risk grade within a loan category to reflect the varied risk of charge-off for each. The standard multipliers range from 0% for a risk grade 1 and 300% for a risk grade 6. In addition, categories that have a concentrated level of charge-offs associated with a particular risk grade could have an additional reserve factor of 50% to 100% added to that particular risk grade. Categories that have had historically high charge-offs also have an additional reserve factor between 25% to 100% added to the risk grade 5s and 6s to account for the additional risk in those categories. The reserve amount by risk grade is calculated and then combined for a blended quantitative reserve factor for each loan category. | |
The allowance for loan losses represents management’s estimate of an appropriate amount to provide for known and inherent losses in the loan portfolio in the normal course of business. While management believes the methodology used to establish the allowance for loan losses incorporates the best information available at the time, future adjustments to the level of the allowance may be necessary and the results of operations could be adversely affected should circumstances differ substantially from the assumptions initially used. We believe that the allowance for loan losses was established in conformity with generally accepted accounting principles. However, upon examination by various regulatory agencies, adjustments to the allowance may be required. Likewise, there can be no assurance that the existing allowance for loan losses is adequate should there be deterioration in the quality of any loans or changes in any of the factors discussed above. Any increases in the provision for loan losses resulting from such deterioration or change in condition could adversely affect our financial condition and results of operations. | |
Income Recognition on Impaired and Nonaccrual Loans | Income Recognition on Impaired and Nonaccrual Loans |
Loans, including impaired loans, are generally classified as nonaccrual when doubts arise regarding the full collectibility of principal or interest and we are therefore uncertain that the borrower can satisfy the contractual terms of the loan agreement. In addition our policy is to place a loan on nonaccrual status at the point when the loan becomes past due 90 days unless there is sufficient documentation to establish that the loan is well secured and in the process of collection. If a loan or a portion of a loan is classified as doubtful or is partially charged-off, the loan is generally classified as nonaccrual. | |
While a loan is classified as nonaccrual and the future collectibility of the recorded loan balance is doubtful, collections of interest and principal are generally applied as a reduction to the principal outstanding, except in the case of loans with scheduled amortizations where the payment is generally applied to the oldest payment due. When the future collectibility of the recorded loan balance is expected, interest income may be recognized on a cash basis. In the case where a nonaccrual loan had been partially charged-off, recognition of interest on a cash basis is limited to that which would have been recognized on the recorded loan balance at the contractual interest rate. Receipts in excess of that amount are recorded as recoveries to the allowance for loan losses until prior charge-offs have been fully recovered. | |
Bank Premises and Equipment | Bank Premises and Equipment |
Land is carried at cost. Buildings, furniture, and equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method based on the estimated useful lives of assets. Useful lives range from 5 to 10 years for furniture and equipment and 40 years for buildings. Expenditures for repairs and maintenance are charged to expense as incurred. | |
Income Taxes | Income Taxes |
Accrued taxes represent the estimated amount payable to or receivable from taxing jurisdictions, either currently or in the future, and are reported, on a net basis, as a component of “other assets” in the consolidated balance sheets. The calculation of the Company’s income tax expense is complex and requires the use of many estimates and judgments in its determination. | |
Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. These temporary differences consist primarily of the allowance for loan losses, differences in the financial statement and income tax basis in premises and equipment and differences in financial statement and income tax basis in accrued liabilities. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which the temporary differences are expected to be recovered or settled. Deferred tax assets are reduced by a valuation allowance if it is more likely than not that the tax benefits will not be fully realized. | |
Management’s determination of the realization of the net deferred tax asset is based upon management’s judgment of various future events and uncertainties, including the timing and amount of future income and the implementation of various tax plans to maximize realization of the deferred tax asset. As of December 31, 2014, a $22.0 million valuation allowance has been established. | |
From time to time, management bases the estimates of related tax liabilities on its belief that future events will validate management’s current assumptions regarding the ultimate outcome of tax-related exposures. While the Company has obtained the opinion of advisors that the anticipated tax treatment of these transactions should prevail and has assessed the relative merits and risks of the appropriate tax treatment, examination of the Company’s income tax returns, changes in tax law and regulatory guidance may impact the treatment of these transactions and resulting provisions for income taxes. | |
Stock Compensation Plans | Stock Compensation Plans |
The Company accounts for stock based awards granted to employees using the fair value method. The cost of employee services received in exchange for an award of equity instruments in the financial statements over the period the employee is required to perform the services in exchange for the award (usually the vesting period). The cost of employee services received in exchange for an award is based on the grant-date fair value of the award. Excess tax benefits are reported as financing cash inflows, rather than as a reduction of taxes paid, which is included within operating cash flows. | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements |
In August 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205-40), Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. This update requires management to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about an entity’s ability to continue as a going concern within one year after the date that the financial statements are issued. Management’s evaluation should be based on relevant conditions and events that are known and reasonably knowable at the date the financial statements are issued. Substantial doubt about an entity’s ability to continue as a going concern exists when relevant conditions and events, considered in the aggregate, indicate that it is probable that an entity will be unable to meet its obligations as they become due within one year after the date that the financial statements are issued. If the substantial doubt is alleviated as a result of consideration of management’s plans, the entity should disclose information that enables financial statement users to understand the principal conditions or events that raised substantial doubt, management’s evaluation of the conditions and management’s plans to alleviate the substantial doubt. If substantial doubt exists about an entity’s ability to continue as a going concern, and the substantial doubt is not alleviated after consideration of management’s plans, an entity should include a statement in the footnotes indicating that there is substantial doubt about the entity’s ability to continue as a going concern. The amendments in this update become effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. The Company does not believe the adoption of this update will have a material impact of the Company’s consolidated financial statements. | |
In August 2014, the FASB issued ASU No. 2014-14, Receivables - Troubled Debt Restructurings by Creditors (Subtopic 310-40), Classification of Certain Government-Guaranteed Mortgage Loans upon Foreclosure. This update addresses classification of government-guaranteed mortgage loans, including those where guarantees are offered by the Federal Housing Administration (“FHA”), the U.S. Department of Housing and Urban Development (“HUD”), and the U.S. Department of Veterans Affairs (“VA”). Although current accounting guidance stipulates proper measurement and classification in situations where a creditor obtains from a debtor, assets in satisfaction of a receivable (such as through foreclosure), current guidance does not specify how to measure and classify foreclosed mortgage loans that are government-guaranteed. Under the provisions of this update, a creditor would derecognize a mortgage loan that has been foreclosed upon, and recognize a separate receivable if the following conditions are met: (1) The loan has a government guarantee that is not separable from the loan before foreclosure, (2) At the time of foreclosure, the creditor has the intent to convey the real estate property to the guarantor and make a claim on the guarantee, and the creditor has the ability to recover under that claim, and (3) At the time of foreclosure, any amount of the claim that is determined on the basis of the fair value of the real estate is fixed. The amendments within this update are effective for annual and interim periods beginning after December 15, 2014. The Company does not believe the adoption of this update will have a material impact of the Company’s consolidated financial statements. | |
In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements of Accounting Standards Codification (“ASC”) Topic 605, Revenue Recognition, and most industry-specific guidance on revenue recognition throughout the ASC. The new standard is principles based and provides a five step model to determine when and how revenue is recognized. The core principle of the new standard is that revenue should be recognized when a company transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. The new standard also requires disclosure of qualitative and quantitative information surrounding the amount, nature, timing and uncertainty of revenues and cash flows arising from contracts with customers. The new standard is effective for the Company in the first quarter of the year ended December 31, 2017 and can be applied either retrospectively to all periods presented or as a cumulative-effect adjustment as of the date of adoption. Early adoption is not permitted. The Company is currently evaluating the impact of adoption of the new standard on its consolidated financial statements. | |
In January 2014, the FASB issued ASU No. 2014-04, Receivables–Troubled Debt Restructurings by Creditors (Subtopic 310-40): Reclassification of Residential Real Estate Collateralized Consumer Mortgage Loans upon Foreclosure. This update clarifies that an in-substance repossession or foreclosure occurs upon either the creditor obtaining legal title to the residential real estate property or the borrower conveying all interest in the residential real estate property to the creditor to satisfy that loan through completion of a deed in lieu of foreclosure or through a similar legal agreement. This amendment is effective for annual and interim periods beginning after December 15, 2014. The Company does not expect the adoption of this guidance to have a material impact on the Company's financial statements. | |
Other accounting standards that have been issued by the FASB or other standards-setting bodies are not expected to have a material impact on the Company’s financial position, results of operations and cash flows. | |
From time to time the FASB issues exposure drafts for proposed statements of financial accounting standards. Such exposure drafts are subject to comment from the public, to revisions by the FASB and to final issuance by the FASB as statements of financial accounting standards. Management considers the effect of the proposed statements on the consolidated financial statements of the Company and monitors the status of changes to and proposed effective dates of exposure drafts. |
NET_LOSS_PER_SHARE_Tables
NET LOSS PER SHARE (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Earnings Per Share [Abstract] | |||||||||
Schedule of Basic and Diluted Net Income (Loss) | Basic and diluted net income (loss) per common share have been computed based upon net income (loss) as presented in the accompanying consolidated statements of operations divided by the weighted average number of common shares outstanding or assumed to be outstanding as summarized below (amounts in thousands, except share data): | ||||||||
Twelve Months Ended | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Net loss available to common shareholders | $ | (4,189 | ) | $ | (350 | ) | |||
Weighted average number of common shares - basic | 17,484,541 | 7,914,110 | |||||||
Effect of dilutive stock options | — | — | |||||||
Weighted average number of common shares - dilutive | 17,484,541 | 7,914,110 | |||||||
Basic earnings per common share | $ | (0.24 | ) | $ | (0.04 | ) | |||
Diluted earnings per common share | $ | (0.24 | ) | $ | (0.04 | ) | |||
Anti-dilutive awards | 227,407 | 301,705 | |||||||
INVESTMENT_SECURITIES_Tables
INVESTMENT SECURITIES (Tables) | 12 Months Ended | |||||||||||||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||||||||||||
Investments, Debt and Equity Securities [Abstract] | ||||||||||||||||||||||||||||||||
Schedule of Amortized Cost, Gross Unrealized Gains, Gross Unrealized Losses, and Fair Values of Securities Available for Sale | The amortized cost, gross unrealized gains, gross unrealized losses and fair values of securities available-for-sale as of December 31, 2014 and 2013 are as follows (amounts in thousands): | |||||||||||||||||||||||||||||||
Securities Available-for-Sale | ||||||||||||||||||||||||||||||||
At December 31 | ||||||||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||||||||
Amortized | Gross | Gross | Fair | Amortized | Gross | Gross | Fair | |||||||||||||||||||||||||
Cost | Unrealized | Unrealized | Value | Cost | Unrealized | Unrealized | Value | |||||||||||||||||||||||||
Gains | Losses | Gains | Losses | |||||||||||||||||||||||||||||
Taxable municipal securities | $ | 16,412 | $ | 686 | $ | 20 | $ | 17,078 | $ | 6,176 | $ | — | $ | 243 | $ | 5,933 | ||||||||||||||||
Mortgage-backed securities | ||||||||||||||||||||||||||||||||
GNMA | 16,204 | 163 | 103 | 16,264 | 25,773 | — | 296 | 25,477 | ||||||||||||||||||||||||
FNMA & FHLMC | 30,992 | — | 134 | 30,858 | — | — | — | — | ||||||||||||||||||||||||
Trust preferred securities | — | — | — | — | 1,175 | — | 150 | 1,025 | ||||||||||||||||||||||||
Equity securities | 11 | — | — | 11 | 98 | 33 | — | 131 | ||||||||||||||||||||||||
Total | $ | 63,619 | $ | 849 | $ | 257 | $ | 64,211 | $ | 33,222 | $ | 33 | $ | 689 | $ | 32,566 | ||||||||||||||||
Schedule of Amortized Cost, Gross Unrealized Gains, Gross Unrealized Losses, and Fair Values of Securities Held to Maturity | The amortized cost, gross unrealized gains, gross unrealized losses and fair values of securities held-to-maturity as of December 31, 2014 and 2013 are as follows (amounts in thousands): | |||||||||||||||||||||||||||||||
Securities Held-to-Maturity | ||||||||||||||||||||||||||||||||
At December 31 | ||||||||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||||||||
Amortized | Gross | Gross | Fair | Amortized | Gross | Gross | Fair | |||||||||||||||||||||||||
Cost | Unrealized | Unrealized | Value | Cost | Unrealized | Unrealized | Value | |||||||||||||||||||||||||
Gains | Losses | Gains | Losses | |||||||||||||||||||||||||||||
Taxable municipal securities | $ | 3,584 | $ | — | $ | 28 | $ | 3,556 | $ | 3,635 | $ | 3 | $ | 157 | $ | 3,481 | ||||||||||||||||
Mortgage-backed securities | ||||||||||||||||||||||||||||||||
GNMA | 74,482 | 887 | 244 | 75,125 | 89,892 | 162 | 2,171 | 87,883 | ||||||||||||||||||||||||
FNMA | 3,517 | 44 | — | 3,561 | 4,486 | — | 19 | 4,467 | ||||||||||||||||||||||||
Total | $ | 81,583 | $ | 931 | $ | 272 | $ | 82,242 | $ | 98,013 | $ | 165 | $ | 2,347 | $ | 95,831 | ||||||||||||||||
Schedule of Unrealized Losses and Fair Values of Investment Securities | The following tables reflect the gross unrealized losses and fair values of securities available-for-sale, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at the dates presented. (amounts in thousands): | |||||||||||||||||||||||||||||||
Securities Available-for-Sale | ||||||||||||||||||||||||||||||||
31-Dec-14 | ||||||||||||||||||||||||||||||||
Less Than 12 Months | 12 Months or More | Total | ||||||||||||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||||||||||
value | losses | value | losses | value | losses | |||||||||||||||||||||||||||
Taxable municipal securities | $ | 2,580 | $ | 20 | $ | — | $ | — | $ | 2,580 | $ | 20 | ||||||||||||||||||||
Mortgage-backed securities | ||||||||||||||||||||||||||||||||
GNMA | 7,425 | 103 | — | — | 7,425 | 103 | ||||||||||||||||||||||||||
FNMA & FHLMC | 30,858 | 134 | — | — | 30,858 | 134 | ||||||||||||||||||||||||||
Total temporarily impaired securities | $ | 40,863 | $ | 257 | $ | — | $ | — | $ | 40,863 | $ | 257 | ||||||||||||||||||||
Securities Available-for-Sale | ||||||||||||||||||||||||||||||||
31-Dec-13 | ||||||||||||||||||||||||||||||||
Less Than 12 Months | 12 Months or More | Total | ||||||||||||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||||||||||
value | losses | value | losses | value | losses | |||||||||||||||||||||||||||
Taxable municipal securities | $ | 5,933 | $ | 243 | $ | — | $ | — | $ | 5,933 | $ | 243 | ||||||||||||||||||||
Mortgage-backed securities | ||||||||||||||||||||||||||||||||
GNMA | $ | 25,477 | $ | 296 | $ | — | $ | — | $ | 25,477 | $ | 296 | ||||||||||||||||||||
Total temporarily impaired securities | $ | 31,410 | $ | 539 | $ | — | $ | — | $ | 31,410 | $ | 539 | ||||||||||||||||||||
Other than temporary impairment: | ||||||||||||||||||||||||||||||||
Trust preferred securities | — | $ | — | 1,025 | 150 | 1,025 | 150 | |||||||||||||||||||||||||
Total other than temporarily impaired securities | $ | — | $ | — | $ | 1,025 | $ | 150 | $ | 1,025 | $ | 150 | ||||||||||||||||||||
The following tables reflect the gross unrealized losses and fair values of securities held-to-maturity, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at the dates presented. (amounts in thousands): | ||||||||||||||||||||||||||||||||
Securities Held-to-Maturity | ||||||||||||||||||||||||||||||||
31-Dec-14 | ||||||||||||||||||||||||||||||||
Less Than 12 Months | 12 Months or More | Total | ||||||||||||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||||||||||
value | losses | value | losses | value | losses | |||||||||||||||||||||||||||
Taxable municipal securities | $ | — | $ | — | $ | 3,556 | $ | 28 | $ | 3,556 | $ | 28 | ||||||||||||||||||||
Mortgage-backed securities | ||||||||||||||||||||||||||||||||
GNMA | 7,594 | 41 | 12,240 | 203 | 19,834 | 244 | ||||||||||||||||||||||||||
Total temporarily impaired securities | $ | 7,594 | $ | 41 | $ | 15,796 | $ | 231 | $ | 23,390 | $ | 272 | ||||||||||||||||||||
Securities Held-to-Maturity | ||||||||||||||||||||||||||||||||
31-Dec-13 | ||||||||||||||||||||||||||||||||
Less Than 12 Months | 12 Months or More | Total | ||||||||||||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | |||||||||||||||||||||||||||
value | losses | value | losses | value | losses | |||||||||||||||||||||||||||
Taxable municipal securities | $ | 2,776 | $ | 157 | $ | — | $ | — | $ | 2,776 | $ | 157 | ||||||||||||||||||||
Mortgage backed securities | ||||||||||||||||||||||||||||||||
GNMA | 74,830 | 2,073 | 2,223 | 98 | 77,053 | 2,171 | ||||||||||||||||||||||||||
FNMA | 4,467 | 19 | — | — | 4,467 | 19 | ||||||||||||||||||||||||||
Total temporarily impaired securities | $ | 82,073 | $ | 2,249 | $ | 2,223 | $ | 98 | $ | 84,296 | $ | 2,347 | ||||||||||||||||||||
Roll Forward of Credit Losses on Debt Securities | The following table shows a roll forward of the amount related to credit losses recognized on debt securities held by the Company for which a portion of an other-than-temporary impairment was recognized in other comprehensive income (amounts in thousands): | |||||||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||||||||
Balance of credit losses on debt securities at the beginning of the period | $ | 75 | 75 | |||||||||||||||||||||||||||||
Income received on other-than-temporary impaired debt securities | (75 | ) | — | |||||||||||||||||||||||||||||
Balance of credit losses on debt securities at the end of the period | $ | — | $ | 75 | ||||||||||||||||||||||||||||
Investment Securities Classified by Contractual Maturities | The amortized cost and fair value of available-for-sale and held-to-maturity securities at December 31, 2014 by expected maturities are shown below (amounts in thousands). Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. | |||||||||||||||||||||||||||||||
Available-for-Sale | ||||||||||||||||||||||||||||||||
Taxable municipal securities | Mortgage-backed securities - GNMA | Mortgage-backed securities - FNMA & FHLMC | ||||||||||||||||||||||||||||||
Amortized | Fair Value | Amortized | Fair Value | Amortized | Fair Value | |||||||||||||||||||||||||||
Cost | Cost | Cost | ||||||||||||||||||||||||||||||
Due within one year | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||||||
Due after one year through five years | — | — | — | — | — | — | ||||||||||||||||||||||||||
Due after five years through ten years | — | — | — | — | — | — | ||||||||||||||||||||||||||
Due after ten years | 16,412 | 17,078 | 16,204 | 16,264 | 30,992 | 30,858 | ||||||||||||||||||||||||||
Total Munis, GNMA, FNMA & FHLMC securities | $ | 16,412 | $ | 17,078 | $ | 16,204 | $ | 16,264 | $ | 30,992 | $ | 30,858 | ||||||||||||||||||||
Securities without a specific maturity: | ||||||||||||||||||||||||||||||||
Equity securities | 11 | 11 | ||||||||||||||||||||||||||||||
Total other securities | $ | 11 | $ | 11 | ||||||||||||||||||||||||||||
Held-to-Maturity | ||||||||||||||||||||||||||||||||
Taxable municipal securities | Mortgage-backed securities - GNMA | Mortgage-backed securities - FNMA | ||||||||||||||||||||||||||||||
Amortized | Fair Value | Amortized | Fair Value | Amortized | Fair Value | |||||||||||||||||||||||||||
Cost | Cost | Cost | ||||||||||||||||||||||||||||||
Due within one year | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||||||
Due after one year through five years | 1,534 | 1,521 | — | — | — | — | ||||||||||||||||||||||||||
Due after five years through ten years | 2,050 | 2,035 | 769 | 799 | 3,517 | 3,561 | ||||||||||||||||||||||||||
Due after ten years | — | — | 73,713 | 74,326 | — | — | ||||||||||||||||||||||||||
Total Munis, GNMA, FNMA securities | $ | 3,584 | $ | 3,556 | $ | 74,482 | $ | 75,125 | $ | 3,517 | $ | 3,561 | ||||||||||||||||||||
LOANS_AND_ALLOWANCE_FOR_LOAN_L1
LOANS AND ALLOWANCE FOR LOAN LOSSES (Tables) | 12 Months Ended | |||||||||||||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||||||||||||
Loans and Leases Receivable Disclosure [Abstract] | ||||||||||||||||||||||||||||||||
Summary of Loans Outstanding | The classification of loan segments as of December 31, 2014 and 2013 are summarized as follows (amounts in thousands): | |||||||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||||||||
Commercial and industrial | $ | 24,286 | $ | 25,858 | ||||||||||||||||||||||||||||
Commercial construction and land development | 53,642 | 66,253 | ||||||||||||||||||||||||||||||
Commercial real estate | 200,510 | 214,159 | ||||||||||||||||||||||||||||||
Residential construction | 28,130 | 28,697 | ||||||||||||||||||||||||||||||
Residential mortgage | 135,022 | 147,300 | ||||||||||||||||||||||||||||||
Consumer | 7,248 | 6,750 | ||||||||||||||||||||||||||||||
Other | 499 | 738 | ||||||||||||||||||||||||||||||
Consumer credit cards | 2,276 | 2,339 | ||||||||||||||||||||||||||||||
Business credit cards | 1,251 | 1,124 | ||||||||||||||||||||||||||||||
452,864 | 493,218 | |||||||||||||||||||||||||||||||
Deferred cost and (fees), net | (608 | ) | (506 | ) | ||||||||||||||||||||||||||||
Allowance for loan losses | (9,377 | ) | (11,590 | ) | ||||||||||||||||||||||||||||
Net Loans | $ | 442,879 | $ | 481,122 | ||||||||||||||||||||||||||||
Loans held for sale | $ | 2,882 | $ | — | ||||||||||||||||||||||||||||
Summary of Nonperforming Assets | Nonperforming assets at December 31, 2014 and 2013 consist of the following (amounts in thousands): | |||||||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||||||||
Loans past due ninety days or more and still accruing | $ | 17 | $ | 23 | ||||||||||||||||||||||||||||
Nonaccrual loans | 8,259 | 27,227 | ||||||||||||||||||||||||||||||
Loans held for sale - nonperforming | 1,865 | — | ||||||||||||||||||||||||||||||
Foreclosed assets | 3,782 | 8,502 | ||||||||||||||||||||||||||||||
Total | $ | 13,923 | $ | 35,752 | ||||||||||||||||||||||||||||
Schedule of Related Party Loans | The following is a reconciliation of these loans (amounts in thousands): | |||||||||||||||||||||||||||||||
2014 | 2013 | |||||||||||||||||||||||||||||||
Beginning balance | $ | 9,840 | 15,009 | |||||||||||||||||||||||||||||
New loans | 1,539 | 2,600 | ||||||||||||||||||||||||||||||
Principal repayments | (2,602 | ) | (7,769 | ) | ||||||||||||||||||||||||||||
Ending balance | $ | 8,777 | 9,840 | |||||||||||||||||||||||||||||
Summary of Segments of Loans by Grade | The following table illustrates credit risk profile by creditworthiness class as of December 31, 2014 and 2013 (amounts in thousands): | |||||||||||||||||||||||||||||||
December 31, 2014 | ||||||||||||||||||||||||||||||||
Commercial and | Commercial | Commercial | Residential - | Residential - | Consumer - | Other - Loans | Total (1) | |||||||||||||||||||||||||
Industrial | Construction | Real Estate- | Construction | Mortgage | Other | |||||||||||||||||||||||||||
and Land | Other | |||||||||||||||||||||||||||||||
Development | ||||||||||||||||||||||||||||||||
1 - Lowest Risk | $ | 2,099 | $ | — | $ | — | $ | — | $ | — | $ | 1,638 | $ | — | $ | 3,737 | ||||||||||||||||
2 - Satisfactory Quality | 606 | 630 | 2,206 | — | 14,794 | 314 | 11 | 18,561 | ||||||||||||||||||||||||
3 - Satisfactory Quality - Merits Attention | 9,506 | 10,625 | 81,761 | 1,893 | 53,007 | 3,556 | 225 | 160,573 | ||||||||||||||||||||||||
4 - Low Satisfactory | 11,932 | 34,709 | 110,683 | 26,074 | 56,359 | 1,186 | 146 | 241,089 | ||||||||||||||||||||||||
5 - Special mention | 143 | 1,892 | 3,989 | — | 8,720 | 62 | 117 | 14,923 | ||||||||||||||||||||||||
6 - Substandard or worse (1) | — | 5,786 | 1,871 | 163 | 2,142 | 492 | — | 10,454 | ||||||||||||||||||||||||
$ | 24,286 | $ | 53,642 | $ | 200,510 | $ | 28,130 | $ | 135,022 | $ | 7,248 | $ | 499 | $ | 449,337 | |||||||||||||||||
(1) | The above table does not include business and consumer credit cards and loans held for sale. As of December 31, 2014, there were $2.5 million in risk grade 6 loans classified as held for sale. | |||||||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||||||||
Commercial and | Commercial | Commercial | Residential - | Residential - | Consumer - | Other - | Total (1) | |||||||||||||||||||||||||
Industrial | Construction | Real Estate- | Construction | Mortgage | Other | Loans | ||||||||||||||||||||||||||
and Land | Other | |||||||||||||||||||||||||||||||
Development | ||||||||||||||||||||||||||||||||
1 - Lowest Risk | $ | 2,014 | $ | — | $ | — | $ | — | $ | — | $ | 1,365 | $ | 8 | $ | 3,387 | ||||||||||||||||
2 - Satisfactory Quality | 646 | 374 | 2,696 | 2 | 12,811 | 412 | 15 | 16,956 | ||||||||||||||||||||||||
3 - Satisfactory Quality - Merits Attention | 9,639 | 14,296 | 75,898 | 3,473 | 53,144 | 3,628 | 482 | 160,560 | ||||||||||||||||||||||||
4 - Low Satisfactory | 12,616 | 36,723 | 121,522 | 23,779 | 57,460 | 1,235 | 107 | 253,442 | ||||||||||||||||||||||||
5 - Special mention | 137 | 1,922 | 2,558 | 262 | 8,450 | 63 | 126 | 13,518 | ||||||||||||||||||||||||
6 - Substandard or worse | 806 | 12,938 | 11,485 | 1,181 | 15,435 | 47 | — | 41,892 | ||||||||||||||||||||||||
$ | 25,858 | $ | 66,253 | $ | 214,159 | $ | 28,697 | $ | 147,300 | $ | 6,750 | $ | 738 | $ | 489,755 | |||||||||||||||||
(1) | The above table does not include business and consumer credit cards and loans held for sale. | |||||||||||||||||||||||||||||||
The following table illustrates the credit card portfolio exposure as of December 31, 2014 and 2013 (amounts in thousands): | ||||||||||||||||||||||||||||||||
December 31, 2014 | December 31, 2013 | |||||||||||||||||||||||||||||||
Consumer - | Business- | Consumer- | Business- | |||||||||||||||||||||||||||||
Credit Card | Credit Card | Credit Card | Credit Card | |||||||||||||||||||||||||||||
Performing | $ | 2,263 | $ | 1,248 | $ | 2,316 | $ | 1,124 | ||||||||||||||||||||||||
Non Performing | 13 | 3 | 23 | — | ||||||||||||||||||||||||||||
$ | 2,276 | $ | 1,251 | $ | 2,339 | $ | 1,124 | |||||||||||||||||||||||||
Age Analysis of Past Due Loans | The following tables illustrate the age analysis of past due loans by loan class as of December 31, 2014 and 2013 (amounts in thousands): | |||||||||||||||||||||||||||||||
December 31, 2014 | ||||||||||||||||||||||||||||||||
30-89 Days | Nonaccrual (1) | Greater than 90 Days Past Due | Total Past | Current | Total | |||||||||||||||||||||||||||
Past Due | Due | Loans | ||||||||||||||||||||||||||||||
Commercial & industrial | $ | 14 | $ | — | $ | — | $ | 14 | $ | 24,272 | $ | 24,286 | ||||||||||||||||||||
Commercial construction & land development | 27 | 5,533 | — | 5,560 | 48,082 | 53,642 | ||||||||||||||||||||||||||
Commercial real estate | — | 983 | — | 983 | 199,527 | 200,510 | ||||||||||||||||||||||||||
Residential construction | — | — | — | — | 28,130 | 28,130 | ||||||||||||||||||||||||||
Residential mortgage | 1,058 | 1,271 | — | 2,329 | 132,693 | 135,022 | ||||||||||||||||||||||||||
Consumer | 82 | 472 | — | 554 | 6,694 | 7,248 | ||||||||||||||||||||||||||
Consumer credit cards | 46 | — | 14 | 60 | 2,216 | 2,276 | ||||||||||||||||||||||||||
Business credit cards | 41 | — | 3 | 44 | 1,207 | 1,251 | ||||||||||||||||||||||||||
Other loans | 84 | — | — | 84 | 415 | 499 | ||||||||||||||||||||||||||
Total | $ | 1,352 | $ | 8,259 | $ | 17 | $ | 9,628 | $ | 443,236 | $ | 452,864 | ||||||||||||||||||||
(1) | The above table includes loans held for investment only. As of December 31, 2014, there were $67,000 in loans 30-89 days past due and $1.9 million in loans on nonaccrual classified as held for sale. | |||||||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||||||||
30-89 Days | Nonaccrual | Greater than 90 Days Past Due | Total Past | Current | Total | |||||||||||||||||||||||||||
Past Due | Due | Loans | ||||||||||||||||||||||||||||||
Commercial & industrial | $ | 34 | $ | 651 | — | $ | 685 | $ | 25,173 | $ | 25,858 | |||||||||||||||||||||
Commercial construction & land development | 252 | 9,536 | — | 9,788 | 56,465 | 66,253 | ||||||||||||||||||||||||||
Commercial real estate | 749 | 6,391 | — | 7,140 | 207,019 | 214,159 | ||||||||||||||||||||||||||
Residential construction | — | 695 | — | 695 | 28,002 | 28,697 | ||||||||||||||||||||||||||
Residential mortgage | 421 | 9,943 | — | 10,364 | 136,936 | 147,300 | ||||||||||||||||||||||||||
Consumer | 11 | 11 | — | 22 | 6,728 | 6,750 | ||||||||||||||||||||||||||
Consumer credit cards | 76 | — | 23 | 99 | 2,240 | 2,339 | ||||||||||||||||||||||||||
Business credit cards | 52 | — | — | 52 | 1,072 | 1,124 | ||||||||||||||||||||||||||
Other loans | — | — | — | — | 738 | 738 | ||||||||||||||||||||||||||
Total | $ | 1,595 | $ | 27,227 | 23 | $ | 28,845 | $ | 464,373 | $ | 493,218 | |||||||||||||||||||||
Summary of Impaired Loans | ||||||||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||||||||
Recorded | Unpaid | Related | Interest | |||||||||||||||||||||||||||||
Investment | Principal | Allowance | Average | Income | ||||||||||||||||||||||||||||
Balance | Recorded | Recognized | ||||||||||||||||||||||||||||||
Investment | ||||||||||||||||||||||||||||||||
With no related allowance recorded: | ||||||||||||||||||||||||||||||||
Commercial and industrial | $ | 380 | $ | 517 | $ | — | $ | 491 | $ | 2 | ||||||||||||||||||||||
Commercial construction & land development | 11,142 | 15,809 | — | 13,259 | 168 | |||||||||||||||||||||||||||
Commercial real estate other | 8,437 | 10,131 | — | 9,190 | 132 | |||||||||||||||||||||||||||
Residential construction | 486 | 486 | — | 474 | 26 | |||||||||||||||||||||||||||
Residential mortgage | 10,948 | 12,731 | — | 11,624 | 121 | |||||||||||||||||||||||||||
Consumer | 11 | 22 | — | 17 | — | |||||||||||||||||||||||||||
Subtotal: | $ | 31,404 | $ | 39,696 | $ | — | $ | 35,055 | $ | 449 | ||||||||||||||||||||||
With an allowance recorded: | ||||||||||||||||||||||||||||||||
Commercial and industrial | $ | 309 | $ | 322 | $ | 80 | $ | 321 | $ | — | ||||||||||||||||||||||
Commercial construction & land development | 1,315 | 2,033 | 264 | 1,348 | — | |||||||||||||||||||||||||||
Commercial real estate other | 4,026 | 4,096 | 888 | 4,104 | 136 | |||||||||||||||||||||||||||
Residential construction | 695 | 1,134 | 137 | 749 | — | |||||||||||||||||||||||||||
Residential mortgage | 1,427 | 1,593 | 456 | 1,499 | 8 | |||||||||||||||||||||||||||
Consumer | — | — | — | — | — | |||||||||||||||||||||||||||
Subtotal: | $ | 7,772 | $ | 9,178 | $ | 1,825 | $ | 8,021 | $ | 144 | ||||||||||||||||||||||
Totals: | ||||||||||||||||||||||||||||||||
Commercial | 25,609 | 32,908 | 1,232 | 28,713 | 438 | |||||||||||||||||||||||||||
Consumer | 11 | 22 | — | 17 | — | |||||||||||||||||||||||||||
Residential | 13,556 | 15,944 | 593 | 14,346 | 155 | |||||||||||||||||||||||||||
Grand Total: | $ | 39,176 | $ | 48,874 | $ | 1,825 | $ | 43,076 | $ | 593 | ||||||||||||||||||||||
The following tables illustrate the impaired loans by loan class as of December 31, 2014 and 2013 (amounts in thousands): | ||||||||||||||||||||||||||||||||
December 31, 2014 | ||||||||||||||||||||||||||||||||
Recorded | Unpaid | Related | Average | Interest | ||||||||||||||||||||||||||||
Investment | Principal | Allowance | Recorded | Income | ||||||||||||||||||||||||||||
Balance | Investment | Recognized | ||||||||||||||||||||||||||||||
With no related allowance recorded: | ||||||||||||||||||||||||||||||||
Commercial construction & land development | 5,445 | 6,454 | — | 6,715 | 15 | |||||||||||||||||||||||||||
Commercial real estate | 3,468 | 4,295 | — | 4,103 | 139 | |||||||||||||||||||||||||||
Residential mortgage | 2,030 | 1,614 | — | 2,279 | 59 | |||||||||||||||||||||||||||
Consumer | 467 | 729 | — | 524 | — | |||||||||||||||||||||||||||
Subtotal: | $ | 11,410 | $ | 13,092 | $ | — | $ | 13,621 | $ | 213 | ||||||||||||||||||||||
With an allowance recorded: | ||||||||||||||||||||||||||||||||
Commercial construction & land development | 1,433 | 2,656 | 580 | 1,866 | 92 | |||||||||||||||||||||||||||
Commercial real estate | 372 | 379 | 17 | 378 | 19 | |||||||||||||||||||||||||||
Residential mortgage | 192 | 169 | 61 | 224 | 5 | |||||||||||||||||||||||||||
Consumer | 8 | 6 | 5 | 8 | — | |||||||||||||||||||||||||||
Subtotal: | $ | 2,005 | $ | 3,210 | $ | 663 | $ | 2,476 | $ | 116 | ||||||||||||||||||||||
Totals: | ||||||||||||||||||||||||||||||||
Commercial | 10,718 | 13,784 | 597 | 13,062 | 265 | |||||||||||||||||||||||||||
Consumer | 475 | 735 | 5 | 532 | — | |||||||||||||||||||||||||||
Residential | 2,222 | 1,783 | 61 | 2,503 | 64 | |||||||||||||||||||||||||||
Grand Total | $ | 13,415 | $ | 16,302 | $ | 663 | $ | 16,097 | $ | 329 | ||||||||||||||||||||||
(1) | The above table includes loans held for investment only. As of December 31, 2014, there were $2.4 million in impaired loans classified as held for sale and there were no reserves recorded for these loans. | |||||||||||||||||||||||||||||||
Summary of Troubled Debt Restructurings by Loan Class | The following tables present a breakdown of TDRs by loan class and the type of concession made to the borrower for the periods indicated (amounts in thousands, except number of loans): | |||||||||||||||||||||||||||||||
For the Year Ended | ||||||||||||||||||||||||||||||||
December 31, 2014 | ||||||||||||||||||||||||||||||||
Number of loans | Pre-Modification Outstanding Recorded Investment | Post-Modification Outstanding Recorded Investment | ||||||||||||||||||||||||||||||
Extended payment terms: | ||||||||||||||||||||||||||||||||
Consumer | 1 | 4 | 4 | |||||||||||||||||||||||||||||
Subtotal | 1 | $ | 4 | $ | 4 | |||||||||||||||||||||||||||
Forgiveness of principal: | ||||||||||||||||||||||||||||||||
Commercial construction and land development | 2 | 100 | 43 | |||||||||||||||||||||||||||||
Subtotal | 2 | $ | 100 | $ | 43 | |||||||||||||||||||||||||||
Total | 3 | $ | 104 | $ | 47 | |||||||||||||||||||||||||||
For the Year Ended | ||||||||||||||||||||||||||||||||
31-Dec-13 | ||||||||||||||||||||||||||||||||
Number of loans | Pre-Modification Outstanding Recorded Investment | Post-Modification Outstanding Recorded Investment | ||||||||||||||||||||||||||||||
Extended payment terms: | ||||||||||||||||||||||||||||||||
Residential mortgage | 2 | 202 | 202 | |||||||||||||||||||||||||||||
Subtotal | 2 | $ | 202 | $ | 202 | |||||||||||||||||||||||||||
Other: | ||||||||||||||||||||||||||||||||
Commercial real estate | 1 | 33 | 33 | |||||||||||||||||||||||||||||
Subtotal | 1 | $ | 33 | $ | 33 | |||||||||||||||||||||||||||
Total | 3 | $ | 235 | $ | 235 | |||||||||||||||||||||||||||
Summary of Successes and Failures of Troubled Debt Restructurings | The table below details the progression of TDRs which have been entered into during the previous 12 months (amounts in thousands, except number of loans): | |||||||||||||||||||||||||||||||
December 31, 2014 | ||||||||||||||||||||||||||||||||
Paid in full | Paying as restructured | Converted to non-accrual | Foreclosure/Default | |||||||||||||||||||||||||||||
Number of loans | Recorded Investment | Number of loans | Recorded Investment | Number of loans | Recorded Investment | Number of loans | Recorded Investment | |||||||||||||||||||||||||
Extended payment terms | — | — | 1 | 4 | — | — | — | — | ||||||||||||||||||||||||
Forgiveness of principal | — | — | 2 | 17 | — | — | — | — | ||||||||||||||||||||||||
Total | — | $ | — | 3 | $ | 21 | — | $ | — | — | $ | — | ||||||||||||||||||||
Analysis of the Allowance for Loan Losses by Loan Class | Following is an analysis of the allowance for loan losses by loan segment as of and for the years ended December 31, 2014 and 2013 (amounts in thousands): | |||||||||||||||||||||||||||||||
December 31, 2014 | ||||||||||||||||||||||||||||||||
Real Estate | ||||||||||||||||||||||||||||||||
Commercial and Industrial | Commercial construction and land development | Commercial real estate | Residential construction | Residential mortgage | Consumer | Other | Totals | |||||||||||||||||||||||||
Balance, beginning of period | $ | 487 | $ | 5,037 | $ | 2,981 | $ | 713 | $ | 2,146 | $ | 188 | $ | 38 | $ | 11,590 | ||||||||||||||||
Provision for loan losses | (84 | ) | 2,778 | 2,382 | (106 | ) | 3,041 | (36 | ) | (21 | ) | 7,954 | ||||||||||||||||||||
Loans charged-off | (492 | ) | (3,107 | ) | (3,315 | ) | (171 | ) | (4,847 | ) | (183 | ) | — | (12,115 | ) | |||||||||||||||||
Recoveries | 208 | 397 | 334 | — | 866 | 120 | 23 | 1,948 | ||||||||||||||||||||||||
Net (charge-offs) recoveries | (284 | ) | (2,710 | ) | (2,981 | ) | (171 | ) | (3,981 | ) | (63 | ) | 23 | (10,167 | ) | |||||||||||||||||
Balance, end of period | $ | 119 | $ | 5,105 | $ | 2,382 | $ | 436 | $ | 1,206 | $ | 89 | $ | 40 | $ | 9,377 | ||||||||||||||||
Ending balance: individually evaluated for impairment | $ | — | $ | 516 | $ | 4 | $ | — | $ | — | $ | 4 | $ | — | $ | 524 | ||||||||||||||||
Ending balance: collectively evaluated for impairment | $ | 119 | $ | 4,589 | $ | 2,378 | $ | 436 | $ | 1,206 | $ | 85 | $ | 40 | $ | 8,853 | ||||||||||||||||
Loans: | ||||||||||||||||||||||||||||||||
Ending Balance | $ | 25,537 | $ | 53,642 | $ | 200,510 | $ | 28,130 | $ | 135,022 | $ | 9,524 | $ | 499 | $ | 452,864 | ||||||||||||||||
Ending balance: individually evaluated for impairment | $ | — | $ | 6,678 | $ | 3,801 | $ | — | $ | 2,030 | $ | 471 | $ | — | $ | 12,980 | ||||||||||||||||
Ending balance: collectively evaluated for impairment (1) | $ | 25,537 | $ | 46,964 | $ | 196,709 | $ | 28,130 | $ | 132,992 | $ | 9,053 | $ | 499 | $ | 439,884 | ||||||||||||||||
(1) | At December 31, 2014 there was $436,000 in impaired loans collectively evaluated for impairment with $139,000 in reserves established. | |||||||||||||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||||||||||
Real Estate | ||||||||||||||||||||||||||||||||
Commercial and Industrial | Commercial construction and land development | Commercial real estate | Residential construction | Residential mortgage | Consumer | Other | Totals | |||||||||||||||||||||||||
Balance, beginning of period | $ | 1,185 | $ | 7,251 | $ | 2,961 | $ | 423 | $ | 4,471 | $ | 188 | $ | 70 | $ | 16,549 | ||||||||||||||||
Provision for loan losses | (801 | ) | 958 | 701 | 428 | (1,332 | ) | 117 | (36 | ) | 35 | |||||||||||||||||||||
Loans charged-off | (411 | ) | (3,759 | ) | (2,226 | ) | (138 | ) | (1,553 | ) | (271 | ) | — | (8,358 | ) | |||||||||||||||||
Recoveries | 514 | 587 | 1,545 | — | 560 | 154 | 4 | 3,364 | ||||||||||||||||||||||||
Net recoveries (charge-offs) | 103 | (3,172 | ) | (681 | ) | (138 | ) | (993 | ) | (117 | ) | 4 | (4,994 | ) | ||||||||||||||||||
Balance, end of period | $ | 487 | $ | 5,037 | $ | 2,981 | $ | 713 | $ | 2,146 | $ | 188 | $ | 38 | $ | 11,590 | ||||||||||||||||
Ending balance: individually evaluated for impairment | $ | 80 | $ | 264 | $ | 887 | $ | 137 | $ | 384 | $ | — | $ | — | $ | 1,752 | ||||||||||||||||
Ending balance: collectively evaluated for impairment | $ | 407 | $ | 4,773 | $ | 2,094 | $ | 576 | $ | 1,762 | $ | 188 | $ | 38 | $ | 9,838 | ||||||||||||||||
Loans: | ||||||||||||||||||||||||||||||||
Ending Balance | $ | 26,982 | $ | 66,253 | $ | 214,159 | $ | 28,697 | $ | 147,300 | $ | 9,089 | $ | 738 | $ | 493,218 | ||||||||||||||||
Ending balance: individually evaluated for impairment | $ | 652 | $ | 12,234 | $ | 12,345 | $ | 1,181 | $ | 11,043 | $ | — | $ | — | $ | 37,455 | ||||||||||||||||
Ending balance: collectively evaluated for impairment (1) | $ | 26,330 | $ | 54,019 | $ | 201,814 | $ | 27,516 | $ | 136,257 | $ | 9,089 | $ | 738 | $ | 455,763 | ||||||||||||||||
(1) | In 2013, the Bank began evaluating small dollar homogeneous impaired loans collectively for impairment and these impaired loans are included in this total. At December 31, 2013, there were $1.7 million in impaired loans collectively evaluated for impairment with $73,000 in reserves established. |
BANK_AND_PREMISES_EQUIPMENT_Ta
BANK AND PREMISES EQUIPMENT (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Property, Plant and Equipment [Abstract] | ||||||||
Schedule of Premises and Equipment | Company premises and equipment at December 31, 2014 and 2013 are as follows (amounts in thousands): | |||||||
2014 | 2013 | |||||||
Land | $ | 4,394 | $ | 4,394 | ||||
Buildings and leasehold improvements | 11,189 | 11,171 | ||||||
Furniture and equipment | 11,411 | 11,511 | ||||||
Construction in process | 562 | 509 | ||||||
27,556 | 27,585 | |||||||
Less accumulated depreciation | (15,661 | ) | (15,014 | ) | ||||
$ | 11,895 | $ | 12,571 | |||||
DEPOSITS_Tables
DEPOSITS (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Banking and Thrift [Abstract] | ||||||||||||
Schedule of Maturities of Time Deposits | At December 31, 2014, the scheduled maturities of time deposits are as follows (amounts in thousands): | |||||||||||
Less than | $100,000 | Total | ||||||||||
$100,000 | or more | |||||||||||
2015 | $ | 57,486 | $ | 78,937 | $ | 136,423 | ||||||
2016 | 20,998 | 38,481 | 59,479 | |||||||||
2017 | 7,474 | 13,034 | 20,508 | |||||||||
2018 | 2,393 | 6,794 | 9,187 | |||||||||
2019 | 1,679 | 3,481 | 5,160 | |||||||||
2020 and beyond | 365 | 2,609 | 2,974 | |||||||||
Total time deposits | $ | 90,395 | $ | 143,336 | $ | 233,731 | ||||||
BORROWINGS_Tables
BORROWINGS (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Debt Disclosure [Abstract] | |||||||||||||
Schedule of Federal Home Loan Bank, Advances | At December 31, 2014 and 2013, borrowed funds included the following FHLB advances (amounts in thousands): | ||||||||||||
Maturity | Interest Rate | 2014 | 2013 | ||||||||||
May 25, 2016 | 4.46% | Fixed | $ | — | $ | 5,000 | |||||||
November 17, 2016 | 4.11% | Fixed | — | 5,000 | |||||||||
November 30, 2016 | 4.09% | Fixed | — | 7,000 | |||||||||
June 5, 2017 | 4.35% | Fixed | 10,000 | 10,000 | |||||||||
July 3, 2017 | 4.36% | Fixed | 13,000 | 13,000 | |||||||||
July 24, 2017 | 4.34% | Fixed | — | 5,000 | |||||||||
July 31, 2017 | 4.35% | Fixed | 5,000 | 5,000 | |||||||||
August 14, 2017 | 4.08% | Fixed | 5,000 | 5,000 | |||||||||
August 14, 2017 | 3.94% | Fixed | 5,000 | 5,000 | |||||||||
October 4, 2017 | 3.95% | Fixed | 7,000 | 7,000 | |||||||||
February 5, 2018 | 2.06% | Fixed | 10,000 | 10,000 | |||||||||
June 5, 2018 | 2.25% | Fixed | 5,000 | 5,000 | |||||||||
June 5, 2018 | 2.55% | Fixed | 5,000 | 5,000 | |||||||||
June 5, 2018 | 3.03% | Fixed | 5,000 | 5,000 | |||||||||
September 10, 2018 | 3.14% | Fixed | 10,000 | 10,000 | |||||||||
September 18, 2018 | 2.71% | Fixed | 10,000 | 10,000 | |||||||||
$ | 90,000 | $ | 112,000 | ||||||||||
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Income Tax Disclosure [Abstract] | ||||||||
Schedule of Components of Income Tax Expense (Benefit) | Allocation of income tax expense between current and deferred portions is as follows (amounts in thousands): | |||||||
Years Ended December 31, | ||||||||
2014 | 2013 | |||||||
Current tax expense (benefit): | ||||||||
Federal | $ | — | $ | — | ||||
State | — | — | ||||||
— | — | |||||||
Deferred tax expense (benefit): | ||||||||
Federal | — | — | ||||||
State | — | — | ||||||
— | — | |||||||
Income tax expense (benefit) before adjustment to deferred tax asset valuation allowance | — | — | ||||||
Net deferred tax expense (benefit) | $ | — | $ | — | ||||
Schedule of Effective Income Tax Rate Reconciliation | The reconciliation of expected income tax at the statutory federal rate of 34% with income tax expense is as follows (amounts in thousands): | |||||||
Years Ended December 31, | ||||||||
2014 | 2013 | |||||||
Expense computed at statutory rate of 34% | $ | (1,424 | ) | $ | (119 | ) | ||
Effect of state income taxes, net of federal benefit | (22 | ) | (28 | ) | ||||
Tax exempt income | 39 | (494 | ) | |||||
Bank owned life insurance income | (71 | ) | (82 | ) | ||||
Valuation allowance | 1,421 | 708 | ||||||
Other, net | 57 | 15 | ||||||
$ | — | $ | — | |||||
Schedule of Deferred Tax Assets | Deferred income taxes consist of the following (amounts in thousands): | |||||||
Years Ended December 31, | ||||||||
2014 | 2013 | |||||||
Deferred tax assets: | ||||||||
Allowance for loan losses | $ | 3,454 | $ | 4,389 | ||||
Non-qualified stock options | 384 | 368 | ||||||
OTTI | 345 | 602 | ||||||
Net deferred loan fees | 206 | 189 | ||||||
Net operating loss | 16,187 | 16,313 | ||||||
FMV adjustment on purchased assets | 89 | 104 | ||||||
SERP accrual | 178 | 179 | ||||||
Other | 2,545 | 1,354 | ||||||
Unrealized loss on securities | — | 166 | ||||||
Total deferred tax assets | 23,388 | 23,664 | ||||||
Less valuation allowance | (22,013 | ) | (22,542 | ) | ||||
Net deferred tax assets | 1,375 | 1,122 | ||||||
Deferred tax liabilities: | ||||||||
Property and equipment | $ | 809 | $ | 765 | ||||
Prepaid expense | 255 | 328 | ||||||
Unrealized gain on securities | 282 | — | ||||||
Other | 29 | 29 | ||||||
Total deferred tax liabilities | 1,375 | 1,122 | ||||||
Net deferred tax liability, included in other liabilities | $ | — | $ | — | ||||
REGULATORY_RESTRICTIONS_Tables
REGULATORY RESTRICTIONS (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Regulatory Capital Requirements [Abstract] | |||||||||||||||||||||
Schedule of Capital Amounts and Ratios | The Bank’s actual capital amounts and ratios are also presented in the table below (amounts in thousands, except ratios): | ||||||||||||||||||||
Actual | Minimum For Capital | Minimum To be Well | |||||||||||||||||||
Adequacy Purposes | Capitalized under | ||||||||||||||||||||
Prompt Corrective | |||||||||||||||||||||
Action Provisions | |||||||||||||||||||||
Amount | Ratio | Amount | Ratio | Amount | Ratio | ||||||||||||||||
As of December 31, 2014: | |||||||||||||||||||||
Total Capital (to Risk Weighted Assets) | $ | 66,498 | 14.7 | % | $ | 36,109 | 8 | % | $ | 45,136 | 10 | % | |||||||||
Tier I Capital (to Risk Weighted Assets) | 60,810 | 13.5 | % | 18,054 | 4 | % | 27,082 | 6 | % | ||||||||||||
Tier I Capital (to Average Assets) | 60,810 | 7.2 | % | 33,844 | 4 | % | 42,305 | 5 | % | ||||||||||||
As of December 31, 2013: | |||||||||||||||||||||
Total Capital (to Risk Weighted Assets) | $ | 50,601 | 10.9 | % | $ | 37,057 | 8 | % | $ | 46,322 | 10 | % | |||||||||
Tier I Capital (to Risk Weighted Assets) | 44,739 | 9.7 | % | 18,529 | 4 | % | 27,793 | 6 | % | ||||||||||||
Tier I Capital (to Average Assets) | 44,739 | 5.5 | % | 32,529 | 4 | % | 40,661 | 5 | % | ||||||||||||
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Commitments and Contingencies Disclosure [Abstract] | ||||||||
Schedule of Loan Commitments | At December 31, 2014 and 2013, financial instruments whose contract amounts represent credit risk were (amounts in thousands): | |||||||
2014 | 2013 | |||||||
Commitments to extend credit | $ | 14,182 | $ | 7,655 | ||||
Undisbursed lines of credit | 73,888 | 52,326 | ||||||
Financial stand-by letters of credit | 238 | 798 | ||||||
Performance stand-by letters of credit | 1,203 | 193 | ||||||
Legally binding commitments | 89,511 | 60,972 | ||||||
Credit card lines | 12,773 | 13,858 | ||||||
Total | $ | 102,284 | $ | 74,830 | ||||
FAIR_VALUE_MEASUREMENTS_Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||
Assets Measured at Fair Value on a Recurring Basis | The following table presents information about assets measured at fair value on a recurring basis at December 31, 2014 and 2013 (amounts in thousands): | ||||||||||||||||||||
Description | Fair Value Measurements at | ||||||||||||||||||||
December 31, 2014, Using | |||||||||||||||||||||
Total Carrying | Assets | Quoted Prices | Significant | Significant | |||||||||||||||||
Amount in the | Measured | in Active | Other | Unobservable | |||||||||||||||||
Consolidated | at Fair Value | Markets | Observable | Inputs | |||||||||||||||||
Balance Sheet | for Identical | Inputs | |||||||||||||||||||
Assets | |||||||||||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||
Taxable municipal securities | $ | 17,078 | $ | 17,078 | $ | — | $ | 17,078 | $ | — | |||||||||||
Mortgage-backed securities: | |||||||||||||||||||||
GNMA | 16,264 | 16,264 | — | 16,264 | — | ||||||||||||||||
FNMA & FHLMC | 30,858 | 30,858 | — | 30,858 | — | ||||||||||||||||
Equity securities | 11 | 11 | — | 11 | — | ||||||||||||||||
Total available-for-sale securities | $ | 64,211 | $ | 64,211 | $ | — | $ | 64,211 | $ | — | |||||||||||
Description | Fair Value Measurements at | ||||||||||||||||||||
December 31, 2013 Using | |||||||||||||||||||||
Total Carrying | Assets | Quoted Prices | Significant | Significant | |||||||||||||||||
Amount in the | Measured | in Active | Other | Unobservable | |||||||||||||||||
Consolidated | at Fair Value | Markets | Observable | Inputs | |||||||||||||||||
Balance Sheet | for Identical | Inputs | |||||||||||||||||||
Assets | |||||||||||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||
Taxable municipal securities | $ | 5,933 | $ | 5,933 | $ | — | $ | 5,933 | $ | — | |||||||||||
Mortgage-backed securities: | |||||||||||||||||||||
GNMA | 25,477 | 25,477 | — | 25,477 | — | ||||||||||||||||
Trust preferred securities | 1,025 | 1,025 | — | — | 1,025 | ||||||||||||||||
Equity securities | 131 | 131 | 70 | 61 | — | ||||||||||||||||
Total available-for-sale securities | $ | 32,566 | $ | 32,566 | $ | 70 | $ | 31,471 | $ | 1,025 | |||||||||||
Level 3 Assets Measured at Fair Value on a Recurring Basis | The table below presents reconciliation for the years ended December 31, 2014 and 2013 for all Level 3 assets that are measured at fair value on a recurring basis (amounts in thousands). During the year ended December 31, 2014, no securities were transferred from Level 3 to Level 2. | ||||||||||||||||||||
Available-for-Sale Securities | |||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
Beginning Balance | $ | 1,025 | $ | 1,006 | |||||||||||||||||
Total realized and unrealized gains or (losses): | |||||||||||||||||||||
Included in earnings | 250 | — | |||||||||||||||||||
Included in other comprehensive income | 150 | 19 | |||||||||||||||||||
Purchases, issuances and settlements | (1,425 | ) | — | ||||||||||||||||||
Ending Balance | $ | — | $ | 1,025 | |||||||||||||||||
Impaired Loans and Foreclosed Assets Measured at Fair Value on a Nonrecurring Basis | Assets measured at fair value on a non-recurring basis are included in the table below at December 31, 2014 and 2013 (amounts in thousands): | ||||||||||||||||||||
Fair Value Measurements at | |||||||||||||||||||||
December 31, 2014, Using | |||||||||||||||||||||
Description | Total Carrying Amount in the Consolidated Balance Sheet | Assets Measured at Fair Value | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs | Significant Unobservable Inputs | ||||||||||||||||
(Level 2) | (Level 3) | ||||||||||||||||||||
Loans held for sale | $ | 2,882 | $ | 2,882 | $ | — | $ | 2,882 | $ | — | |||||||||||
Impaired loans | $ | 9,855 | $ | 9,855 | $ | — | $ | — | $ | 9,855 | |||||||||||
Foreclosed assets | $ | 3,782 | $ | 3,782 | $ | — | $ | — | $ | 3,782 | |||||||||||
Fair Value Measurements at | |||||||||||||||||||||
December 31, 2013, Using | |||||||||||||||||||||
Description | Total Carrying Amount in the Consolidated Balance Sheet | Assets Measured at Fair Value | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs | Significant Unobservable Inputs | ||||||||||||||||
(Level 2) | (Level 3) | ||||||||||||||||||||
Impaired loans | $ | 18,215 | $ | 18,215 | $ | — | $ | — | $ | 18,215 | |||||||||||
Foreclosed assets | $ | 8,502 | $ | 8,502 | $ | — | $ | — | $ | 8,502 | |||||||||||
Quantitative Information About Level 3 Fair Value Measurements | The following table presents the valuation methodology and unobservable inputs for Level 3 assets measured at fair value on a nonrecurring basis at December 31, 2014 (amounts in thousands, except percentages): | ||||||||||||||||||||
Total Carrying Amount at December 31, 2014 | Valuation Methodology | Range of Inputs | |||||||||||||||||||
Nonrecurring measurements: | |||||||||||||||||||||
Impaired loans | $ | 9,855 | Collateral discounts | 9 - 50% | |||||||||||||||||
Foreclosed assets | $ | 3,782 | Discounted appraisals | 10 - 30% | |||||||||||||||||
Range of Collateral Discounts for Impaired Loans by Segment | The following table reflects the general range of collateral discounts for impaired loans by segment: | ||||||||||||||||||||
Loan Segment: | Range of Percentages | ||||||||||||||||||||
Commercial construction and land development | 10.5% - 40% | ||||||||||||||||||||
Commercial real estate other | 12.5% - 50% | ||||||||||||||||||||
Residential construction | 9% - 30% | ||||||||||||||||||||
Residential mortgage | 9% - 20% | ||||||||||||||||||||
All other segments | 9% - 20% | ||||||||||||||||||||
Fair Value, by Balance Sheet Grouping | The following table presents information for financial assets and liabilities as of December 31, 2014 and 2013 (amounts in thousands): | ||||||||||||||||||||
December 31, 2014 | |||||||||||||||||||||
Carrying | Estimated | Level 1 | Level 2 | Level 3 | |||||||||||||||||
Value | Fair Value | ||||||||||||||||||||
Financial assets: | |||||||||||||||||||||
Cash and cash equivalents | $ | 158,527 | $ | 158,527 | $ | 158,527 | $ | — | $ | — | |||||||||||
Certificates of deposit | 27,784 | 27,784 | — | 27,784 | — | ||||||||||||||||
Securities available for sale | 64,211 | 64,211 | — | 64,211 | — | ||||||||||||||||
Securities held to maturity | 81,583 | 82,242 | — | 82,242 | — | ||||||||||||||||
Loans held for sale | 2,882 | 2,882 | — | 2,882 | — | ||||||||||||||||
Loans, net | 442,879 | 422,906 | — | — | 422,906 | ||||||||||||||||
FHLB stock | 4,788 | 4,788 | — | 4,788 | — | ||||||||||||||||
Accrued interest receivable | 1,627 | 1,627 | — | 1,627 | — | ||||||||||||||||
Financial liabilities: | |||||||||||||||||||||
Deposits | $ | 661,185 | $ | 663,000 | $ | — | $ | 663,000 | $ | — | |||||||||||
Subordinated debentures and subordinated promissory notes | 24,372 | 25,671 | — | — | 25,671 | ||||||||||||||||
Borrowings | 90,000 | 95,573 | — | 95,573 | — | ||||||||||||||||
Accrued interest payable | 1,704 | 1,704 | — | 1,704 | — | ||||||||||||||||
December 31, 2013 | |||||||||||||||||||||
Carrying | Estimated | Level 1 | Level 2 | Level 3 | |||||||||||||||||
Value | Fair Value | ||||||||||||||||||||
Financial assets: | |||||||||||||||||||||
Cash and cash equivalents | $ | 128,629 | $ | 128,629 | $ | 128,629 | $ | — | $ | — | |||||||||||
Certificates of deposit | 31,850 | 31,850 | — | 31,850 | — | ||||||||||||||||
Securities available for sale | 32,566 | 32,566 | 70 | 31,471 | 1,025 | ||||||||||||||||
Securities held to maturity | 98,013 | 95,831 | — | 95,831 | — | ||||||||||||||||
Loans, net | 481,122 | 458,254 | — | — | 458,254 | ||||||||||||||||
FHLB stock | 6,076 | 6,076 | — | 6,076 | — | ||||||||||||||||
Accrued interest receivable | 1,576 | 1,576 | — | 1,576 | — | ||||||||||||||||
Financial liabilities: | |||||||||||||||||||||
Deposits | $ | 657,620 | $ | 659,733 | $ | — | $ | 659,733 | $ | — | |||||||||||
Subordinated debentures and subordinated promissory notes | 24,372 | 24,369 | — | — | 24,369 | ||||||||||||||||
Borrowings | 112,000 | 121,519 | — | 121,519 | — | ||||||||||||||||
Accrued interest payable | 1,642 | 1,642 | — | 1,642 | — | ||||||||||||||||
STOCK_OPTION_PLAN_Tables
STOCK OPTION PLAN (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||
Summary of Option Activity | A summary of option activity under the Plan for the year ended December 31, 2014, is presented below: | ||||||||||||
Shares | Option | Weighted | Aggregate | ||||||||||
Price Per | Average | Intrinsic | |||||||||||
Share | Remaining | Value | |||||||||||
Contractual | |||||||||||||
Term | |||||||||||||
Outstanding at January 1, 2014 | 301,705 | $ | 5.99 | ||||||||||
Issued | 54,375 | 1.7 | |||||||||||
Exercised | — | — | |||||||||||
Forfeited | 29,723 | 4.46 | |||||||||||
Expired | 47,775 | 8.64 | |||||||||||
Balance at December 31, 2014 | 278,582 | $ | 4.86 | 2.15 | $ | 18,935 | |||||||
Exercisable at December 31, 2014 | 174,026 | $ | 6.92 | 1.23 | $ | — | |||||||
Summary of Non-vested Options | A summary of the status of the Company's non-vested options as of December 31, 2014 and changes during the year then ended is presented below: | ||||||||||||
Shares | Weighted average grant date fair value | ||||||||||||
Non-vested - December 31, 2013 | 111,656 | $ | 0.78 | ||||||||||
Granted | 53,350 | 1.03 | |||||||||||
Vested | 4,825 | 0.69 | |||||||||||
Forfeited/Expired | 55,625 | 0.87 | |||||||||||
Non-vested - December 31, 2014 | 104,556 | $ | 0.86 | ||||||||||
Schedule of Shares Authorized under Stock Option Plans, by Exercise Price Range | Additional information concerning the Company’s stock options at December 31, 2014 is as follows: | ||||||||||||
Exercise Price | Number | Contractual | Number | ||||||||||
Outstanding | Life (Years) | Exercisable | |||||||||||
1.15-1.69 | 51,175 | 3.19 | — | ||||||||||
1.70 - 2.99 | 101,975 | 3.2 | 48,623 | ||||||||||
3.00 - 5.49 | 46,175 | 1.16 | 46,173 | ||||||||||
5.50 - 10.91 | 46,175 | 0.15 | 46,151 | ||||||||||
10.92 - 40.78 | 20,777 | 0.55 | 20,774 | ||||||||||
40.79 | 12,305 | 3.07 | 12,305 | ||||||||||
278,582 | 2.15 | 174,026 | |||||||||||
Schedule of Stock Options, Valuation Assumptions | The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model with the following assumptions used for grants in 2014 and 2013: | ||||||||||||
2014 | 2013 | ||||||||||||
Dividend yield | 0 | % | 0 | % | |||||||||
Expected volatility | 73.31 | % | 73.3 | % | |||||||||
Risk free interest rate | 1.57 | % | 0.9 | % | |||||||||
Expected life | 5 years | 5 years | |||||||||||
LEASES_Tables
LEASES (Tables) | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Leases [Abstract] | ||||
Schedule of Future Minimum Rental Payments | Future minimum lease payments under the leases for future years are as follows (amounts in thousands): | |||
Leases | ||||
2015 | $ | 350 | ||
2016 | 284 | |||
2017 | 232 | |||
2018 | 185 | |||
2019 | 178 | |||
2020 and beyond | 449 | |||
$ | 1,678 | |||
PARENT_COMPANY_FINANCIAL_INFOR1
PARENT COMPANY FINANCIAL INFORMATION (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | ||||||||
Schedule of Condensed Balance Sheets | Condensed financial information of Four Oaks Fincorp, Inc. at December 31, 2014 and 2013, and for the years ended December 31, 2014 and 2013 is presented below (amounts in thousands): | |||||||
Condensed Balance Sheets | 2014 | 2013 | ||||||
Assets: | ||||||||
Cash and cash equivalents | $ | 3,958 | $ | 456 | ||||
Equity investment in subsidiaries | 61,937 | 44,925 | ||||||
Investment securities available-for-sale | 11 | 1,156 | ||||||
Other assets | 131 | 195 | ||||||
Total assets | $ | 66,037 | $ | 46,732 | ||||
Liabilities and Shareholders’ Equity: | ||||||||
Other liabilities | $ | 936 | $ | 737 | ||||
Subordinated debentures | 12,372 | 12,372 | ||||||
Subordinated promissory notes | 12,000 | 12,000 | ||||||
Shareholders' equity | 40,729 | 21,623 | ||||||
Total liabilities and shareholders’ equity | $ | 66,037 | $ | 46,732 | ||||
Schedule of Condensed Statements of Operations | ||||||||
For the Years Ended December 31, | ||||||||
Condensed Statements of Operations | 2014 | 2013 | ||||||
Equity in undistributed (loss) income of subsidiaries | $ | (3,128 | ) | $ | 899 | |||
Interest income | 5 | 2 | ||||||
Gain on sale of investments, available-for-sale | 109 | — | ||||||
Recovery of impairment loss on investment securities available-for-sale | 189 | — | ||||||
Other income | 20 | 87 | ||||||
Other expenses | (1,384 | ) | (1,338 | ) | ||||
Net loss | $ | (4,189 | ) | $ | (350 | ) | ||
Schedule of Condensed Statements of Cash Flows | ||||||||
Condensed Statements of Cash Flows | 2014 | 2013 | ||||||
Operating activities: | ||||||||
Net loss | $ | (4,189 | ) | $ | (350 | ) | ||
Equity in undistributed loss of subsidiaries | 3,128 | (899 | ) | |||||
Gain on sale of investments | (298 | ) | — | |||||
Increase in other assets | 16 | 427 | ||||||
Increase in other liabilities | 199 | 203 | ||||||
Net cash used in operating activities | (1,144 | ) | (619 | ) | ||||
Investing activities: | ||||||||
Investment in subsidiaries | (19,157 | ) | — | |||||
Sales and maturities of securities | 1,560 | 72 | ||||||
Net cash used in investing activities | (17,597 | ) | 72 | |||||
Financing activities: | ||||||||
Proceeds from issuance of common stock | 22,243 | 219 | ||||||
Net cash provided by financing activities | 22,243 | 219 | ||||||
Net increase (decrease) in cash and cash equivalents | 3,502 | (328 | ) | |||||
Cash and cash equivalents, beginning of year | 456 | 784 | ||||||
Cash and cash equivalents, end of year | $ | 3,958 | $ | 456 | ||||
ORGANIZATION_AND_SUMMARY_OF_SI2
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Narrative) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Cash and Cash Equivalents: | ||
Daily average gross reserve requirement | $0 | |
Loans Held for Sale: | ||
Transfers of loans to loans held for sale | 13,193,000 | 0 |
Income Recognition on Impaired and Nonaccrual Loans: | ||
Threshold period past due for nonaccrual status of loans | 90 days | |
Stock in Federal Home Loan Bank of Atlanta: | ||
FHLB stock | 4,788,000 | 6,076,000 |
Income Taxes: | ||
Valuation allowance | 22,013,000 | 22,542,000 |
Building [Member] | ||
Bank Premises and Equipment: | ||
Bank premises and equipment, useful life | 40 years | |
Minimum [Member] | ||
Allowance for Loan Losses: | ||
Additional reserve factor for categories with concentrated level of charge-offs | 50.00% | |
Minimum [Member] | Furniture and Equipment [Member] | ||
Bank Premises and Equipment: | ||
Bank premises and equipment, useful life | 5 years | |
Minimum [Member] | Risk Grade 1 [Member] | ||
Allowance for Loan Losses: | ||
Standard multipliers | 0.00% | |
Minimum [Member] | Risk Grade 5s and 6s [Member] | ||
Allowance for Loan Losses: | ||
Additional reserve factor for categories with historically high charge-offs | 25.00% | |
Maximum [Member] | ||
Allowance for Loan Losses: | ||
Additional reserve factor for categories with concentrated level of charge-offs | 100.00% | |
Maximum [Member] | Furniture and Equipment [Member] | ||
Bank Premises and Equipment: | ||
Bank premises and equipment, useful life | 10 years | |
Maximum [Member] | Risk Grade 6 [Member] | ||
Allowance for Loan Losses: | ||
Standard multipliers | 300.00% | |
Maximum [Member] | Risk Grade 5s and 6s [Member] | ||
Allowance for Loan Losses: | ||
Additional reserve factor for categories with historically high charge-offs | 100.00% | |
Current Model [Member] | Rolling Two Years Charge-offs [Member] | ||
Allowance for Loan Losses: | ||
Charge-off rate, period | 2 years | |
Current Model [Member] | Rolling Three Yeard Charge-offs [Member] | ||
Allowance for Loan Losses: | ||
Charge-off rate, period | 3 years | |
Interest Rate Lock Commitments [Member] | ||
Rate Lock Commitments: | ||
Interest rate lock commitment period | 60 days | |
Asset Resolution Plan [Member] | ||
Loans Held for Sale: | ||
Transfers of loans to loans held for sale | $10,100,000 |
NET_LOSS_PER_SHARE_Details
NET LOSS PER SHARE (Details) (USD $) | 12 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Earnings Per Share [Abstract] | ||
Net loss | ($4,189) | ($350) |
Weighted average number of common shares outstanding: | ||
Weighted average number of common shares - basic | 17,484,541 | 7,914,110 |
Effect of dilutive stock options (in shares) | 0 | 0 |
Weighted average number of commons shares and dilutive potential common shares used in computing diluted net loss per share | 17,484,541 | 7,914,110 |
Basic earnings per common share (in usd per share) | ($0.24) | ($0.04) |
Diluted earnings per common share (in usd per share) | ($0.24) | ($0.04) |
Antidilutive awards (in shares) | 227,407 | 301,705 |
Issuance of common stock | $22,242 | $220 |
Issuance of common stock (in shares) | 24,000,000 | |
Increase (decrease) in weighted average shares outstanding | 9,600,000 |
INVESTMENT_SECURITIES_Availabl
INVESTMENT SECURITIES (Available for Sale Securities) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | $63,619 | $33,222 |
Gross Unrealized Gains | 849 | 33 |
Gross Unrealized Losses | 257 | 689 |
Investment securities available-for-sale, at fair value | 64,211 | 32,566 |
Taxable Municipal Securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 16,412 | 6,176 |
Gross Unrealized Gains | 686 | 0 |
Gross Unrealized Losses | 20 | 243 |
Investment securities available-for-sale, at fair value | 17,078 | 5,933 |
Mortgage-backed Securities GNMA [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 16,204 | 25,773 |
Gross Unrealized Gains | 163 | 0 |
Gross Unrealized Losses | 103 | 296 |
Investment securities available-for-sale, at fair value | 16,264 | 25,477 |
Mortgage-backed Securities FNMA [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 30,992 | 0 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 134 | 0 |
Investment securities available-for-sale, at fair value | 30,858 | 0 |
Trust Preferred Securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 0 | 1,175 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 150 |
Investment securities available-for-sale, at fair value | 0 | 1,025 |
Equity Securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 11 | 98 |
Gross Unrealized Gains | 0 | 33 |
Gross Unrealized Losses | 0 | 0 |
Investment securities available-for-sale, at fair value | $11 | $131 |
INVESTMENT_SECURITIES_Held_to_
INVESTMENT SECURITIES (Held to Maturity Securities) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Amortized Cost | $81,583 | $98,013 |
Gross Unrealized Gains | 931 | 165 |
Gross Unrealized Losses | 272 | 2,347 |
Securities held to maturity | 82,242 | 95,831 |
Taxable Municipal Securities [Member] | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Amortized Cost | 3,584 | 3,635 |
Gross Unrealized Gains | 0 | 3 |
Gross Unrealized Losses | 28 | 157 |
Securities held to maturity | 3,556 | 3,481 |
Mortgage-backed Securities GNMA [Member] | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Amortized Cost | 74,482 | 89,892 |
Gross Unrealized Gains | 887 | 162 |
Gross Unrealized Losses | 244 | 2,171 |
Securities held to maturity | 75,125 | 87,883 |
Mortgage-backed Securities FNMA [Member] | ||
Schedule of Held-to-maturity Securities [Line Items] | ||
Amortized Cost | 3,517 | 4,486 |
Gross Unrealized Gains | 44 | 0 |
Gross Unrealized Losses | 0 | 19 |
Securities held to maturity | $3,561 | $4,467 |
INVESTMENT_SECURITIES_Unrealiz
INVESTMENT SECURITIES (Unrealized Losses and Fair Values of Investment Securities) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Temporarily Impaired Securities [Member] | ||
Securities available for sale: | ||
Less Than 12 Months, Fair value | $40,863 | $31,410 |
Less Than 12 Months, Unrealized losses | 257 | 539 |
12 Months or More, Fair value | 0 | 0 |
12 Months or More, Unrealized losses | 0 | 0 |
Total, Fair value | 40,863 | 31,410 |
Total, Unrealized losses | 257 | 539 |
Securities Held to Maturity: | ||
Less Than 12 Months, Fair value | 7,594 | 82,073 |
Less Than 12 Months, Unrealized losses | 41 | 2,249 |
12 Months or More, Fair value | 15,796 | 2,223 |
12 Months or More, Unrealized losses | 231 | 98 |
Total, Fair value | 23,390 | 84,296 |
Total, Unrealized losses | 272 | 2,347 |
Temporarily Impaired Securities [Member] | Taxable Municipal Securities [Member] | ||
Securities available for sale: | ||
Less Than 12 Months, Fair value | 2,580 | 5,933 |
Less Than 12 Months, Unrealized losses | 20 | 243 |
12 Months or More, Fair value | 0 | 0 |
12 Months or More, Unrealized losses | 0 | 0 |
Total, Fair value | 2,580 | 5,933 |
Total, Unrealized losses | 20 | 243 |
Securities Held to Maturity: | ||
Less Than 12 Months, Fair value | 0 | 2,776 |
Less Than 12 Months, Unrealized losses | 0 | 157 |
12 Months or More, Fair value | 3,556 | 0 |
12 Months or More, Unrealized losses | 28 | 0 |
Total, Fair value | 3,556 | 2,776 |
Total, Unrealized losses | 28 | 157 |
Temporarily Impaired Securities [Member] | Mortgage-backed Securities GNMA [Member] | ||
Securities available for sale: | ||
Less Than 12 Months, Fair value | 7,425 | 25,477 |
Less Than 12 Months, Unrealized losses | 103 | 296 |
12 Months or More, Fair value | 0 | 0 |
12 Months or More, Unrealized losses | 0 | 0 |
Total, Fair value | 7,425 | 25,477 |
Total, Unrealized losses | 103 | 296 |
Securities Held to Maturity: | ||
Less Than 12 Months, Fair value | 7,594 | 74,830 |
Less Than 12 Months, Unrealized losses | 41 | 2,073 |
12 Months or More, Fair value | 12,240 | 2,223 |
12 Months or More, Unrealized losses | 203 | 98 |
Total, Fair value | 19,834 | 77,053 |
Total, Unrealized losses | 244 | 2,171 |
Temporarily Impaired Securities [Member] | Mortgage-backed Securities FNMA & FHLMC [Member] | ||
Securities available for sale: | ||
Less Than 12 Months, Fair value | 30,858 | |
Less Than 12 Months, Unrealized losses | 134 | |
12 Months or More, Fair value | 0 | |
12 Months or More, Unrealized losses | 0 | |
Total, Fair value | 30,858 | |
Total, Unrealized losses | 134 | |
Temporarily Impaired Securities [Member] | Mortgage-backed Securities FNMA [Member] | ||
Securities Held to Maturity: | ||
Less Than 12 Months, Fair value | 4,467 | |
Less Than 12 Months, Unrealized losses | 19 | |
12 Months or More, Fair value | 0 | |
12 Months or More, Unrealized losses | 0 | |
Total, Fair value | 4,467 | |
Total, Unrealized losses | 19 | |
Other than Temporarily Impaired Securities [Member] | ||
Securities available for sale: | ||
Less Than 12 Months, Fair value | 0 | |
Less Than 12 Months, Unrealized losses | 0 | |
12 Months or More, Fair value | 1,025 | |
12 Months or More, Unrealized losses | 150 | |
Total, Fair value | 1,025 | |
Total, Unrealized losses | 150 | |
Other than Temporarily Impaired Securities [Member] | Trust Preferred Securities [Member] | ||
Securities available for sale: | ||
Less Than 12 Months, Fair value | 0 | |
Less Than 12 Months, Unrealized losses | 0 | |
12 Months or More, Fair value | 1,025 | |
12 Months or More, Unrealized losses | 150 | |
Total, Fair value | 1,025 | |
Total, Unrealized losses | $150 |
INVESTMENT_SECURITIES_Roll_For
INVESTMENT SECURITIES (Roll Forward of Credit Losses on Debt Securities) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Roll forward of credit losses recognized on debt securities held with OTTI recognized in OCI: | ||
Balance of credit losses on debt securities at the beginning of the period | $75 | $75 |
Income received on other-than-temporary impaired debt securities | -75 | 0 |
Balance of credit losses on debt securities at the end of the period | $0 | $75 |
INVESTMENT_SECURITIES_Investme
INVESTMENT SECURITIES (Investment Securities Classified by Contractual Maturities) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Available for Sale, Amortized Cost | ||
Amortized Cost | $63,619 | $33,222 |
Available for Sale, Fair Value | ||
Fair Value | 64,211 | 32,566 |
Held to Maturity, Fair Value | ||
Fair Value | 82,242 | 95,831 |
Taxable Municipal Securities [Member] | ||
Available for Sale, Amortized Cost | ||
Due within one year | 0 | |
Due after one year through five years | 0 | |
Due after five years through ten years | 0 | |
Due after ten years | 16,412 | |
Amortized Cost | 16,412 | 6,176 |
Available for Sale, Fair Value | ||
Due within one year | 0 | |
Due after one year through five years | 0 | |
Due after five years through ten years | 0 | |
Due after ten years | 17,078 | |
Fair Value | 17,078 | 5,933 |
Held to Maturity, Amortized Cost | ||
Due within one year | 0 | |
Due after one year through five years | 1,534 | |
Due after five years through ten years | 2,050 | |
Due after ten years | 0 | |
Amortized Cost | 3,584 | |
Held to Maturity, Fair Value | ||
Due within one year | 0 | |
Due after one year through five years | 1,521 | |
Due after five years through ten years | 2,035 | |
Due after ten years | 0 | |
Fair Value | 3,556 | 3,481 |
Mortgage-backed Securities GNMA [Member] | ||
Available for Sale, Amortized Cost | ||
Due within one year | 0 | |
Due after one year through five years | 0 | |
Due after five years through ten years | 0 | |
Due after ten years | 16,204 | |
Amortized Cost | 16,204 | 25,773 |
Available for Sale, Fair Value | ||
Due within one year | 0 | |
Due after one year through five years | 0 | |
Due after five years through ten years | 0 | |
Due after ten years | 16,264 | |
Fair Value | 16,264 | 25,477 |
Held to Maturity, Amortized Cost | ||
Due within one year | 0 | |
Due after one year through five years | 0 | |
Due after five years through ten years | 769 | |
Due after ten years | 73,713 | |
Amortized Cost | 74,482 | |
Held to Maturity, Fair Value | ||
Due within one year | 0 | |
Due after one year through five years | 0 | |
Due after five years through ten years | 799 | |
Due after ten years | 74,326 | |
Fair Value | 75,125 | 87,883 |
Mortgage-backed Securities FNMA & FHLMC [Member] | ||
Available for Sale, Amortized Cost | ||
Due within one year | 0 | |
Due after one year through five years | 0 | |
Due after five years through ten years | 0 | |
Due after ten years | 30,992 | |
Amortized Cost | 30,992 | |
Available for Sale, Fair Value | ||
Due within one year | 0 | |
Due after one year through five years | 0 | |
Due after five years through ten years | 0 | |
Due after ten years | 30,858 | |
Fair Value | 30,858 | |
Mortgage-backed Securities FNMA [Member] | ||
Available for Sale, Amortized Cost | ||
Amortized Cost | 30,992 | 0 |
Available for Sale, Fair Value | ||
Fair Value | 30,858 | 0 |
Held to Maturity, Amortized Cost | ||
Due within one year | 0 | |
Due after one year through five years | 0 | |
Due after five years through ten years | 3,517 | |
Due after ten years | 0 | |
Amortized Cost | 3,517 | |
Held to Maturity, Fair Value | ||
Due within one year | 0 | |
Due after one year through five years | 0 | |
Due after five years through ten years | 3,561 | |
Due after ten years | 0 | |
Fair Value | 3,561 | 4,467 |
Equity Securities [Member] | ||
Available for Sale, Amortized Cost | ||
Amortized Cost | 11 | 98 |
Available for Sale, Fair Value | ||
Fair Value | 11 | 131 |
Total Other Securities [Member] | ||
Available for Sale, Amortized Cost | ||
Amortized Cost | 11 | |
Available for Sale, Fair Value | ||
Fair Value | $11 |
INVESTMENT_SECURITIES_Narrativ
INVESTMENT SECURITIES (Narrative) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Schedule of Available-for-sale Securities [Line Items] | ||
OTTI losses recognized | $0 | |
Carrying value of securities | 101,800,000 | 92,800,000 |
Proceeds from sales and calls of investment securities available-for-sale | 22,737,000 | 20,873,000 |
Gross realized gains | 563,172 | 462,460 |
Gross realized losses | $0 | $0 |
Collateralized Mortgage Obligations, Issued by GNMA [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Number of positions | 14 | |
Number of debt securities held | 55 | |
MBS, Pass-through Securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Number of positions | 6 | |
Number of debt securities held | 9 | |
Taxable Municipal Securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Number of positions | 12 | |
Number of debt securities held | 31 |
LOANS_AND_ALLOWANCE_FOR_LOAN_L2
LOANS AND ALLOWANCE FOR LOAN LOSSES (Loans Outstanding) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | |||
Loans and Leases Receivable Disclosure [Abstract] | |||
Commercial and industrial | $24,286 | $25,858 | |
Commercial construction and land development | 53,642 | 66,253 | |
Commercial real estate | 200,510 | 214,159 | |
Residential construction | 28,130 | 28,697 | |
Residential mortgage | 135,022 | 147,300 | |
Consumer | 7,248 | 6,750 | |
Other | 499 | 738 | |
Consumer credit cards | 2,276 | 2,339 | |
Business credit cards | 1,251 | 1,124 | |
Ending Balance | 452,864 | 493,218 | |
Deferred cost and (fees), net | -608 | -506 | |
Allowance for loan losses | -9,377 | -11,590 | -16,549 |
Net loans | 442,879 | 481,122 | |
Loans held for sale | $2,882 | $0 |
LOANS_AND_ALLOWANCE_FOR_LOAN_L3
LOANS AND ALLOWANCE FOR LOAN LOSSES (Nonperforming Assets) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Loans and Leases Receivable Disclosure [Abstract] | ||
Loans past due ninety days or more and still accruing | $17 | $23 |
Nonaccrual loans | 8,259 | 27,227 |
Loans held for sale - nonperforming | 1,865 | 0 |
Foreclosed assets | 3,782 | 8,502 |
Total | $13,923 | $35,752 |
LOANS_AND_ALLOWANCE_FOR_LOAN_L4
LOANS AND ALLOWANCE FOR LOAN LOSSES (Related Party Loans) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Loans and Leases Receivable, Related Parties [Roll Forward] | ||
Beginning balance | $9,840 | $15,009 |
New loans | 1,539 | 2,600 |
Principal repayments | -2,602 | -7,769 |
Ending balance | $8,777 | $9,840 |
LOANS_AND_ALLOWANCE_FOR_LOAN_L5
LOANS AND ALLOWANCE FOR LOAN LOSSES (Credit Quality) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial and Industrial | $24,286 | $25,858 |
Commercial Construction and Land Development | 53,642 | 66,253 |
Commercial Real Estate- Other | 200,510 | 214,159 |
Residential - Construction | 28,130 | 28,697 |
Residential - Mortgage | 135,022 | 147,300 |
Consumer - Other | 7,248 | 6,750 |
Other - Loans | 499 | 738 |
Total | 449,337 | 489,755 |
Consumer - Credit Card | 2,276 | 2,339 |
Business- Credit Card | 1,251 | 1,124 |
Risk grade 6 loans classified as held for sale | 2,882 | 0 |
Credit Card Portfolio Exposure [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Consumer - Credit Card | 2,276 | 2,339 |
Business- Credit Card | 1,251 | 1,124 |
1 - Lowest Risk [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial and Industrial | 2,099 | 2,014 |
Commercial Construction and Land Development | 0 | 0 |
Commercial Real Estate- Other | 0 | 0 |
Residential - Construction | 0 | 0 |
Residential - Mortgage | 0 | 0 |
Consumer - Other | 1,638 | 1,365 |
Other - Loans | 0 | 8 |
Total | 3,737 | 3,387 |
2 - Satisfactory Quality [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial and Industrial | 606 | 646 |
Commercial Construction and Land Development | 630 | 374 |
Commercial Real Estate- Other | 2,206 | 2,696 |
Residential - Construction | 0 | 2 |
Residential - Mortgage | 14,794 | 12,811 |
Consumer - Other | 314 | 412 |
Other - Loans | 11 | 15 |
Total | 18,561 | 16,956 |
3 - Satisfactory Quality - Merits Attention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial and Industrial | 9,506 | 9,639 |
Commercial Construction and Land Development | 10,625 | 14,296 |
Commercial Real Estate- Other | 81,761 | 75,898 |
Residential - Construction | 1,893 | 3,473 |
Residential - Mortgage | 53,007 | 53,144 |
Consumer - Other | 3,556 | 3,628 |
Other - Loans | 225 | 482 |
Total | 160,573 | 160,560 |
4 - Low Satisfactory [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial and Industrial | 11,932 | 12,616 |
Commercial Construction and Land Development | 34,709 | 36,723 |
Commercial Real Estate- Other | 110,683 | 121,522 |
Residential - Construction | 26,074 | 23,779 |
Residential - Mortgage | 56,359 | 57,460 |
Consumer - Other | 1,186 | 1,235 |
Other - Loans | 146 | 107 |
Total | 241,089 | 253,442 |
5 - Special Mention [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial and Industrial | 143 | 137 |
Commercial Construction and Land Development | 1,892 | 1,922 |
Commercial Real Estate- Other | 3,989 | 2,558 |
Residential - Construction | 0 | 262 |
Residential - Mortgage | 8,720 | 8,450 |
Consumer - Other | 62 | 63 |
Other - Loans | 117 | 126 |
Total | 14,923 | 13,518 |
6 - Substandard or Worse [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Commercial and Industrial | 0 | 806 |
Commercial Construction and Land Development | 5,786 | 12,938 |
Commercial Real Estate- Other | 1,871 | 11,485 |
Residential - Construction | 163 | 1,181 |
Residential - Mortgage | 2,142 | 15,435 |
Consumer - Other | 492 | 47 |
Other - Loans | 0 | 0 |
Total | 10,454 | 41,892 |
Risk grade 6 loans classified as held for sale | 2,500 | |
Performing [Member] | Credit Card Portfolio Exposure [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Consumer - Credit Card | 2,263 | 2,316 |
Business- Credit Card | 1,248 | 1,124 |
Non Performing [Member] | Credit Card Portfolio Exposure [Member] | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Consumer - Credit Card | 13 | 23 |
Business- Credit Card | $3 | $0 |
LOANS_AND_ALLOWANCE_FOR_LOAN_L6
LOANS AND ALLOWANCE FOR LOAN LOSSES (Age Analysis of Past Due Loans) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
30-89 Days Past Due | $1,352 | $1,595 |
Nonaccrual | 8,259 | 27,227 |
Greater than 90 Days Past Due | 17 | 23 |
Total Past Due | 9,628 | 28,845 |
Current | 443,236 | 464,373 |
Ending Balance | 452,864 | 493,218 |
Loans in 30-89 days past due classified as held for sale | 67 | |
Loans on nonaccrual classified as held for sale | 1,865 | 0 |
Commercial and Industrial [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
30-89 Days Past Due | 14 | 34 |
Nonaccrual | 0 | 651 |
Greater than 90 Days Past Due | 0 | 0 |
Total Past Due | 14 | 685 |
Current | 24,272 | 25,173 |
Ending Balance | 24,286 | 25,858 |
Commercial Construction and Land Development [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
30-89 Days Past Due | 27 | 252 |
Nonaccrual | 5,533 | 9,536 |
Greater than 90 Days Past Due | 0 | 0 |
Total Past Due | 5,560 | 9,788 |
Current | 48,082 | 56,465 |
Ending Balance | 53,642 | 66,253 |
Commercial Real Estate [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
30-89 Days Past Due | 0 | 749 |
Nonaccrual | 983 | 6,391 |
Greater than 90 Days Past Due | 0 | 0 |
Total Past Due | 983 | 7,140 |
Current | 199,527 | 207,019 |
Ending Balance | 200,510 | 214,159 |
Residential Construction [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
30-89 Days Past Due | 0 | 0 |
Nonaccrual | 0 | 695 |
Greater than 90 Days Past Due | 0 | 0 |
Total Past Due | 0 | 695 |
Current | 28,130 | 28,002 |
Ending Balance | 28,130 | 28,697 |
Residential Mortgage [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
30-89 Days Past Due | 1,058 | 421 |
Nonaccrual | 1,271 | 9,943 |
Greater than 90 Days Past Due | 0 | 0 |
Total Past Due | 2,329 | 10,364 |
Current | 132,693 | 136,936 |
Ending Balance | 135,022 | 147,300 |
Consumer [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
30-89 Days Past Due | 82 | 11 |
Nonaccrual | 472 | 11 |
Greater than 90 Days Past Due | 0 | 0 |
Total Past Due | 554 | 22 |
Current | 6,694 | 6,728 |
Ending Balance | 7,248 | 6,750 |
Consumer Credit Cards [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
30-89 Days Past Due | 46 | 76 |
Nonaccrual | 0 | 0 |
Greater than 90 Days Past Due | 14 | 23 |
Total Past Due | 60 | 99 |
Current | 2,216 | 2,240 |
Ending Balance | 2,276 | 2,339 |
Business Credit Cards [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
30-89 Days Past Due | 41 | 52 |
Nonaccrual | 0 | 0 |
Greater than 90 Days Past Due | 3 | 0 |
Total Past Due | 44 | 52 |
Current | 1,207 | 1,072 |
Ending Balance | 1,251 | 1,124 |
Other Loans [Member] | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
30-89 Days Past Due | 84 | 0 |
Nonaccrual | 0 | 0 |
Greater than 90 Days Past Due | 0 | 0 |
Total Past Due | 84 | 0 |
Current | 415 | 738 |
Ending Balance | $499 | $738 |
LOANS_AND_ALLOWANCE_FOR_LOAN_L7
LOANS AND ALLOWANCE FOR LOAN LOSSES (Impaired Loans) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Financing Receivable, Impaired [Line Items] | ||
Impaired loans classified as held for sale | $2,400,000 | |
Reserves recorded for loans held for sale | 0 | |
Impaired Loans, Recorded Investment | ||
With no related allowance recorded | 11,410,000 | 31,404,000 |
With an allowance recorded | 2,005,000 | 7,772,000 |
Total | 13,415,000 | 39,176,000 |
Impaired Loans, Unpaid Principal Balance | ||
With no related allowance recorded | 13,092,000 | 39,696,000 |
With an allowance recorded | 3,210,000 | 9,178,000 |
Total | 16,302,000 | 48,874,000 |
Related Allowance | 663,000 | 1,825,000 |
Impaired Loans, YTD Average Recorded Investment | ||
With no related allowance recorded | 13,621,000 | 35,055,000 |
With an allowance recorded | 2,476,000 | 8,021,000 |
Total | 16,097,000 | 43,076,000 |
Impaired Loans, Interest Income Recognized | ||
With no related allowance recorded | 213,000 | 449,000 |
With an allowance recorded | 116,000 | 144,000 |
Total | 329,000 | 593,000 |
Commercial [Member] | ||
Impaired Loans, Recorded Investment | ||
Total | 10,718,000 | 25,609,000 |
Impaired Loans, Unpaid Principal Balance | ||
Total | 13,784,000 | 32,908,000 |
Related Allowance | 597,000 | 1,232,000 |
Impaired Loans, YTD Average Recorded Investment | ||
Total | 13,062,000 | 28,713,000 |
Impaired Loans, Interest Income Recognized | ||
Total | 265,000 | 438,000 |
Commercial and Industrial [Member] | ||
Impaired Loans, Recorded Investment | ||
With no related allowance recorded | 380,000 | |
With an allowance recorded | 309,000 | |
Impaired Loans, Unpaid Principal Balance | ||
With no related allowance recorded | 517,000 | |
With an allowance recorded | 322,000 | |
Related Allowance | 80,000 | |
Impaired Loans, YTD Average Recorded Investment | ||
With no related allowance recorded | 491,000 | |
With an allowance recorded | 321,000 | |
Impaired Loans, Interest Income Recognized | ||
With no related allowance recorded | 2,000 | |
With an allowance recorded | 0 | |
Commercial Construction and Land Development [Member] | ||
Impaired Loans, Recorded Investment | ||
With no related allowance recorded | 5,445,000 | 11,142,000 |
With an allowance recorded | 1,433,000 | 1,315,000 |
Impaired Loans, Unpaid Principal Balance | ||
With no related allowance recorded | 6,454,000 | 15,809,000 |
With an allowance recorded | 2,656,000 | 2,033,000 |
Related Allowance | 580,000 | 264,000 |
Impaired Loans, YTD Average Recorded Investment | ||
With no related allowance recorded | 6,715,000 | 13,259,000 |
With an allowance recorded | 1,866,000 | 1,348,000 |
Impaired Loans, Interest Income Recognized | ||
With no related allowance recorded | 15,000 | 168,000 |
With an allowance recorded | 92,000 | 0 |
Commercial Real Estate [Member] | ||
Impaired Loans, Recorded Investment | ||
With no related allowance recorded | 3,468,000 | 8,437,000 |
With an allowance recorded | 372,000 | 4,026,000 |
Impaired Loans, Unpaid Principal Balance | ||
With no related allowance recorded | 4,295,000 | 10,131,000 |
With an allowance recorded | 379,000 | 4,096,000 |
Related Allowance | 17,000 | 888,000 |
Impaired Loans, YTD Average Recorded Investment | ||
With no related allowance recorded | 4,103,000 | 9,190,000 |
With an allowance recorded | 378,000 | 4,104,000 |
Impaired Loans, Interest Income Recognized | ||
With no related allowance recorded | 139,000 | 132,000 |
With an allowance recorded | 19,000 | 136,000 |
Residential [Member] | ||
Impaired Loans, Recorded Investment | ||
Total | 2,222,000 | 13,556,000 |
Impaired Loans, Unpaid Principal Balance | ||
Total | 1,783,000 | 15,944,000 |
Related Allowance | 61,000 | 593,000 |
Impaired Loans, YTD Average Recorded Investment | ||
Total | 2,503,000 | 14,346,000 |
Impaired Loans, Interest Income Recognized | ||
Total | 64,000 | 155,000 |
Residential Construction [Member] | ||
Impaired Loans, Recorded Investment | ||
With no related allowance recorded | 486,000 | |
With an allowance recorded | 695,000 | |
Impaired Loans, Unpaid Principal Balance | ||
With no related allowance recorded | 486,000 | |
With an allowance recorded | 1,134,000 | |
Related Allowance | 137,000 | |
Impaired Loans, YTD Average Recorded Investment | ||
With no related allowance recorded | 474,000 | |
With an allowance recorded | 749,000 | |
Impaired Loans, Interest Income Recognized | ||
With no related allowance recorded | 26,000 | |
With an allowance recorded | 0 | |
Residential Mortgage [Member] | ||
Impaired Loans, Recorded Investment | ||
With no related allowance recorded | 2,030,000 | 10,948,000 |
With an allowance recorded | 192,000 | 1,427,000 |
Impaired Loans, Unpaid Principal Balance | ||
With no related allowance recorded | 1,614,000 | 12,731,000 |
With an allowance recorded | 169,000 | 1,593,000 |
Related Allowance | 61,000 | 456,000 |
Impaired Loans, YTD Average Recorded Investment | ||
With no related allowance recorded | 2,279,000 | 11,624,000 |
With an allowance recorded | 224,000 | 1,499,000 |
Impaired Loans, Interest Income Recognized | ||
With no related allowance recorded | 59,000 | 121,000 |
With an allowance recorded | 5,000 | 8,000 |
Consumer [Member] | ||
Impaired Loans, Recorded Investment | ||
With no related allowance recorded | 467,000 | 11,000 |
With an allowance recorded | 8,000 | 0 |
Total | 475,000 | 11,000 |
Impaired Loans, Unpaid Principal Balance | ||
With no related allowance recorded | 729,000 | 22,000 |
With an allowance recorded | 6,000 | 0 |
Total | 735,000 | 22,000 |
Related Allowance | 5,000 | 0 |
Impaired Loans, YTD Average Recorded Investment | ||
With no related allowance recorded | 524,000 | 17,000 |
With an allowance recorded | 8,000 | 0 |
Total | 532,000 | 17,000 |
Impaired Loans, Interest Income Recognized | ||
With no related allowance recorded | 0 | 0 |
With an allowance recorded | 0 | 0 |
Total | $0 | $0 |
LOANS_AND_ALLOWANCE_FOR_LOAN_L8
LOANS AND ALLOWANCE FOR LOAN LOSSES (Troubled Debt Restructurings by Loan Class) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
loans | loans | |
Financing Receivable, Modifications [Line Items] | ||
Number of loans | 3 | 3 |
Pre-Modification Outstanding Recorded Investment | $104 | $235 |
Post-Modification Outstanding Recorded Investment | 47 | 235 |
Extended Payment Terms [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of loans | 1 | 2 |
Pre-Modification Outstanding Recorded Investment | 4 | 202 |
Post-Modification Outstanding Recorded Investment | 4 | 202 |
Extended Payment Terms [Member] | Consumer [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of loans | 1 | |
Pre-Modification Outstanding Recorded Investment | 4 | |
Post-Modification Outstanding Recorded Investment | 4 | |
Extended Payment Terms [Member] | Residential Mortgage [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of loans | 2 | |
Pre-Modification Outstanding Recorded Investment | 202 | |
Post-Modification Outstanding Recorded Investment | 202 | |
Forgiveness of Principal [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of loans | 2 | |
Pre-Modification Outstanding Recorded Investment | 100 | |
Post-Modification Outstanding Recorded Investment | 43 | |
Forgiveness of Principal [Member] | Commercial Construction and Land Development [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of loans | 2 | |
Pre-Modification Outstanding Recorded Investment | 100 | |
Post-Modification Outstanding Recorded Investment | 43 | |
Other [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of loans | 1 | |
Pre-Modification Outstanding Recorded Investment | 33 | |
Post-Modification Outstanding Recorded Investment | 33 | |
Other [Member] | Commercial Real Estate [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of loans | 1 | |
Pre-Modification Outstanding Recorded Investment | 33 | |
Post-Modification Outstanding Recorded Investment | $33 |
LOANS_AND_ALLOWANCE_FOR_LOAN_L9
LOANS AND ALLOWANCE FOR LOAN LOSSES (Status of Troubled Debt Restructurings) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
loans | loans | |
Financing Receivable, Modifications [Line Items] | ||
Number of loans | 3 | 3 |
Number of loans foreclosed | 0 | |
Paid in Full [member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of loans | 0 | |
Recorded investment | 0 | |
Paying as Restructured [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of loans | 3 | |
Recorded investment | 21 | |
Converted to Non-accrual [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of loans | 0 | |
Recorded investment | 0 | |
Foreclosure/Default [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of loans foreclosed | 0 | |
Recorded Investment | 0 | |
Extended Payment Terms [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of loans | 1 | 2 |
Extended Payment Terms [Member] | Paid in Full [member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of loans | 0 | |
Recorded investment | 0 | |
Extended Payment Terms [Member] | Paying as Restructured [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of loans | 1 | |
Recorded investment | 4 | |
Extended Payment Terms [Member] | Converted to Non-accrual [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of loans | 0 | |
Recorded investment | 0 | |
Extended Payment Terms [Member] | Foreclosure/Default [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of loans foreclosed | 0 | |
Recorded Investment | 0 | |
Forgiveness of Principal [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of loans | 2 | |
Forgiveness of Principal [Member] | Paid in Full [member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of loans | 0 | |
Recorded investment | 0 | |
Forgiveness of Principal [Member] | Paying as Restructured [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of loans | 2 | |
Recorded investment | 17 | |
Forgiveness of Principal [Member] | Converted to Non-accrual [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of loans | 0 | |
Recorded investment | 0 | |
Forgiveness of Principal [Member] | Foreclosure/Default [Member] | ||
Financing Receivable, Modifications [Line Items] | ||
Number of loans foreclosed | 0 | |
Recorded Investment | 0 |
Recovered_Sheet1
LOANS AND ALLOWANCE FOR LOAN LOSSES (Allowance for Loan Losses by Loan Class) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Allowance for loan losses: | ||
Balance, beginning of period | $11,590 | $16,549 |
Provision for loan losses | 7,954 | 35 |
Loans charged-off | -12,115 | -8,358 |
Recoveries | 1,948 | 3,364 |
Net (charge-offs) recoveries | -10,167 | -4,994 |
Balance, end of period | 9,377 | 11,590 |
Ending balance: individually evaluated for impairment | 524 | 1,752 |
Ending balance: collectively evaluated for impairment | 8,853 | 9,838 |
Financing Receivables: | ||
Ending Balance | 452,864 | 493,218 |
Ending balance: individually evaluated for impairment | 12,980 | 37,455 |
Ending balance: collectively evaluated for impairment | 439,884 | 455,763 |
Commercial and Industrial [Member] | ||
Allowance for loan losses: | ||
Balance, beginning of period | 487 | 1,185 |
Provision for loan losses | -84 | -801 |
Loans charged-off | -492 | -411 |
Recoveries | 208 | 514 |
Net (charge-offs) recoveries | -284 | 103 |
Balance, end of period | 119 | 487 |
Ending balance: individually evaluated for impairment | 0 | 80 |
Ending balance: collectively evaluated for impairment | 119 | 407 |
Financing Receivables: | ||
Ending Balance | 25,537 | 26,982 |
Ending balance: individually evaluated for impairment | 0 | 652 |
Ending balance: collectively evaluated for impairment | 25,537 | 26,330 |
Commercial Construction and Land Development [Member] | ||
Allowance for loan losses: | ||
Balance, beginning of period | 5,037 | 7,251 |
Provision for loan losses | 2,778 | 958 |
Loans charged-off | -3,107 | -3,759 |
Recoveries | 397 | 587 |
Net (charge-offs) recoveries | -2,710 | -3,172 |
Balance, end of period | 5,105 | 5,037 |
Ending balance: individually evaluated for impairment | 516 | 264 |
Ending balance: collectively evaluated for impairment | 4,589 | 4,773 |
Financing Receivables: | ||
Ending Balance | 53,642 | 66,253 |
Ending balance: individually evaluated for impairment | 6,678 | 12,234 |
Ending balance: collectively evaluated for impairment | 46,964 | 54,019 |
Commercial Real Estate [Member] | ||
Allowance for loan losses: | ||
Balance, beginning of period | 2,981 | 2,961 |
Provision for loan losses | 2,382 | 701 |
Loans charged-off | -3,315 | -2,226 |
Recoveries | 334 | 1,545 |
Net (charge-offs) recoveries | -2,981 | -681 |
Balance, end of period | 2,382 | 2,981 |
Ending balance: individually evaluated for impairment | 4 | 887 |
Ending balance: collectively evaluated for impairment | 2,378 | 2,094 |
Financing Receivables: | ||
Ending Balance | 200,510 | 214,159 |
Ending balance: individually evaluated for impairment | 3,801 | 12,345 |
Ending balance: collectively evaluated for impairment | 196,709 | 201,814 |
Residential Construction [Member] | ||
Allowance for loan losses: | ||
Balance, beginning of period | 713 | 423 |
Provision for loan losses | -106 | 428 |
Loans charged-off | -171 | -138 |
Recoveries | 0 | 0 |
Net (charge-offs) recoveries | -171 | -138 |
Balance, end of period | 436 | 713 |
Ending balance: individually evaluated for impairment | 0 | 137 |
Ending balance: collectively evaluated for impairment | 436 | 576 |
Financing Receivables: | ||
Ending Balance | 28,130 | 28,697 |
Ending balance: individually evaluated for impairment | 0 | 1,181 |
Ending balance: collectively evaluated for impairment | 28,130 | 27,516 |
Residential Mortgage [Member] | ||
Allowance for loan losses: | ||
Balance, beginning of period | 2,146 | 4,471 |
Provision for loan losses | 3,041 | -1,332 |
Loans charged-off | -4,847 | -1,553 |
Recoveries | 866 | 560 |
Net (charge-offs) recoveries | -3,981 | -993 |
Balance, end of period | 1,206 | 2,146 |
Ending balance: individually evaluated for impairment | 0 | 384 |
Ending balance: collectively evaluated for impairment | 1,206 | 1,762 |
Financing Receivables: | ||
Ending Balance | 135,022 | 147,300 |
Ending balance: individually evaluated for impairment | 2,030 | 11,043 |
Ending balance: collectively evaluated for impairment | 132,992 | 136,257 |
Consumer [Member] | ||
Allowance for loan losses: | ||
Balance, beginning of period | 188 | 188 |
Provision for loan losses | -36 | 117 |
Loans charged-off | -183 | -271 |
Recoveries | 120 | 154 |
Net (charge-offs) recoveries | -63 | -117 |
Balance, end of period | 89 | 188 |
Ending balance: individually evaluated for impairment | 4 | 0 |
Ending balance: collectively evaluated for impairment | 85 | 188 |
Financing Receivables: | ||
Ending Balance | 9,524 | 9,089 |
Ending balance: individually evaluated for impairment | 471 | 0 |
Ending balance: collectively evaluated for impairment | 9,053 | 9,089 |
Other [Member] | ||
Allowance for loan losses: | ||
Balance, beginning of period | 38 | 70 |
Provision for loan losses | -21 | -36 |
Loans charged-off | 0 | 0 |
Recoveries | 23 | 4 |
Net (charge-offs) recoveries | 23 | 4 |
Balance, end of period | 40 | 38 |
Ending balance: individually evaluated for impairment | 0 | 0 |
Ending balance: collectively evaluated for impairment | 40 | 38 |
Financing Receivables: | ||
Ending Balance | 499 | 738 |
Ending balance: individually evaluated for impairment | 0 | 0 |
Ending balance: collectively evaluated for impairment | 499 | 738 |
Small Dollar Homogeneous Impaired Loans [Member] | ||
Allowance for loan losses: | ||
Ending balance: collectively evaluated for impairment | 139 | 73 |
Financing Receivables: | ||
Ending balance: collectively evaluated for impairment | $436 | $1,700 |
Recovered_Sheet2
LOANS AND ALLOWANCE FOR LOAN LOSSES (Narrative) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
loans | loans | |
Loans and Leases Receivable Disclosure [Abstract] | ||
Number of loans included in the population of purchased impaired loans | 1 | |
Total loans | $452,864 | $493,218 |
Impaired loans, recorded investment | 13,415 | 39,176 |
Carrying value of impaired loans before allocations | 2,005 | 7,772 |
Impaired loans, allowance | 663 | 1,825 |
Impaired loans, with no related allowance | 11,410 | 31,404 |
Average recorded investment in impaired loans | 16,097 | 43,076 |
Interest recognized on impaired loans | 329 | 593 |
Number of loans modified | 3 | 3 |
Pre-classification outstanding recorded investment | $104 | $235 |
Modified TDRs | 0 |
BANK_AND_PREMISES_EQUIPMENT_De
BANK AND PREMISES EQUIPMENT (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | $27,556,000 | $27,585,000 |
Less accumulated depreciation | -15,661,000 | -15,014,000 |
Premises and equipment, net | 11,895,000 | 12,571,000 |
Depreciation expense | 800,000 | 1,000,000 |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | 4,394,000 | 4,394,000 |
Buildings and Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | 11,189,000 | 11,171,000 |
Furniture and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | 11,411,000 | 11,511,000 |
Construction in Process [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Premises and equipment, gross | $562,000 | $509,000 |
DEPOSITS_Details
DEPOSITS (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Less than $100,000 | ||
2015 | $57,486 | |
2016 | 20,998 | |
2017 | 7,474 | |
2018 | 2,393 | |
2019 | 1,679 | |
2020 and beyond | 365 | |
Total time deposits | 90,395 | 100,912 |
$100,000 or more | ||
2015 | 78,937 | |
2016 | 38,481 | |
2017 | 13,034 | |
2018 | 6,794 | |
2019 | 3,481 | |
2020 and beyond | 2,609 | |
Total time deposits | 143,336 | 162,403 |
Total | ||
2015 | 136,423 | |
2016 | 59,479 | |
2017 | 20,508 | |
2018 | 9,187 | |
2019 | 5,160 | |
2020 and beyond | 2,974 | |
Total time deposits | $233,731 |
BORROWINGS_Details
BORROWINGS (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ||
FHLB Advances | $90,000,000 | $112,000,000 |
Additional Disclosure [Abstract] | ||
FHLB, available lines of credit | 164,000,000 | |
FHLB borrowings, weighted average interest rate | 3.42% | 3.58% |
Line of credit, various financial institutions | 16,000,000 | |
Federal fund purchases outstanding | 0 | |
4.46% Advance Maturing May 25, 2016 [Member] | ||
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ||
Interest Rate | 4.46% | |
FHLB Advances | 0 | 5,000,000 |
4.11% Advance Maturing November 17, 2016 [Member] | ||
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ||
Interest Rate | 4.11% | |
FHLB Advances | 0 | 5,000,000 |
4.09% Advance Maturing November 30, 2016 [Member] | ||
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ||
Interest Rate | 4.09% | |
FHLB Advances | 0 | 7,000,000 |
4.35% Advance Maturing June 5, 2017 [Member] | ||
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ||
Interest Rate | 4.35% | |
FHLB Advances | 10,000,000 | 10,000,000 |
4.36% Advance Maturing July 3, 2017 [Member] | ||
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ||
Interest Rate | 4.36% | |
FHLB Advances | 13,000,000 | 13,000,000 |
4.34% Advance Maturing July 24, 2017 [Member] | ||
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ||
Interest Rate | 4.34% | |
FHLB Advances | 0 | 5,000,000 |
4.35% Advance Maturing July 31, 2017 [Member] | ||
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ||
Interest Rate | 4.35% | |
FHLB Advances | 5,000,000 | 5,000,000 |
4.08% Advance Maturing August 14, 2017 [Member] | ||
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ||
Interest Rate | 4.08% | |
FHLB Advances | 5,000,000 | 5,000,000 |
3.94% Advance Maturing August 14, 2017 [Member] | ||
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ||
Interest Rate | 3.94% | |
FHLB Advances | 5,000,000 | 5,000,000 |
3.95% Advance Maturing October 4, 2017 [Member] | ||
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ||
Interest Rate | 3.95% | |
FHLB Advances | 7,000,000 | 7,000,000 |
2.06% Advance Maturing February 5, 2018 [Member] | ||
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ||
Interest Rate | 2.06% | |
FHLB Advances | 10,000,000 | 10,000,000 |
2.25% Advance Maturing June 5, 2018 [Member] | ||
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ||
Interest Rate | 2.25% | |
FHLB Advances | 5,000,000 | 5,000,000 |
2.55% Advance Maturing June 5, 2018 [Member] | ||
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ||
Interest Rate | 2.55% | |
FHLB Advances | 5,000,000 | 5,000,000 |
3.03% Advance Maturing June 5, 2018 [Member] | ||
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ||
Interest Rate | 3.03% | |
FHLB Advances | 5,000,000 | 5,000,000 |
3.14% Advance Maturing September 10, 2018 [Member] | ||
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ||
Interest Rate | 3.14% | |
FHLB Advances | 10,000,000 | 10,000,000 |
2.71% Advance Maturing September 18, 2018 [Member] | ||
Federal Home Loan Bank, Advances, Branch of FHLB Bank [Line Items] | ||
Interest Rate | 2.71% | |
FHLB Advances | $10,000,000 | $10,000,000 |
TRUST_PREFERRED_SECURITIES_Det
TRUST PREFERRED SECURITIES (Details) (USD $) | 0 Months Ended | ||
Mar. 30, 2006 | Dec. 31, 2014 | Dec. 31, 2013 | |
Trust Preferred Securities | |||
Trust preferred securities | $12,000,000 | ||
Accrued interest payable | 1,704,000 | 1,642,000 | |
Subordinated Debt [Member] | |||
Trust Preferred Securities | |||
Accrued interest payable | $899,000 | ||
LIBOR [Member] | Subordinated Debt [Member] | Trust Preferred Securities [Member] | |||
Trust Preferred Securities | |||
Trust preferred securities, basis spread on variable rate | 1.35% |
SUBORDINATED_PROMISSORY_NOTES_
SUBORDINATED PROMISSORY NOTES (Details) (USD $) | 4 Months Ended |
In Millions, unless otherwise specified | Aug. 31, 2009 |
Subordinated Debt [Abstract] | |
Aggregate principal amount of subordinated promissory notes sold | $12 |
Subordinated debt, maturity period | 10 years |
Subordinated debt, interest rate | 8.50% |
INCOME_TAXES_Allocation_of_Inc
INCOME TAXES (Allocation of Income Tax Expense (Benefit)) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Current tax expense (benefit): | ||
Federal | $0 | $0 |
State | 0 | 0 |
Current tax expense (benefit) | 0 | 0 |
Deferred tax expense (benefit): | ||
Federal | 0 | 0 |
State | 0 | 0 |
Deferred tax expense (benefit) | 0 | 0 |
Income tax expense (benefit) before adjustment to deferred tax asset valuation allowance | 0 | 0 |
Income tax expense (benefit) | $0 | $0 |
INCOME_TAXES_Income_Tax_Reconc
INCOME TAXES (Income Tax Reconciliation) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Income Tax Disclosure [Abstract] | ||
Statutory federal rate | 34.00% | |
Expense computed at statutory rate of 34% | ($1,424) | ($119) |
Effect of state income taxes, net of federal benefit | -22 | -28 |
Tax exempt income | 39 | -494 |
Bank owned life insurance income | -71 | -82 |
Valuation allowance | 1,421 | 708 |
Other, net | 57 | 15 |
Income tax expense (benefit) | $0 | $0 |
INCOME_TAXES_Deferred_Tax_Asse
INCOME TAXES (Deferred Tax Assets) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | |||
Deferred tax assets: | |||
Allowance for loan losses | $3,454 | $4,389 | |
Non-qualified stock options | 384 | 368 | |
OTTI | 345 | 602 | |
Net deferred loan fees | 206 | 189 | |
Net operating loss | 16,187 | 16,313 | |
FMV adjustment on purchased assets | 89 | 104 | |
SERP accrual | 178 | 179 | |
Other | 2,545 | 1,354 | |
Unrealized loss on securities | 0 | 166 | |
Total deferred tax assets | 23,388 | 23,664 | |
Less valuation allowance | -22,013 | -22,542 | |
Net deferred tax assets | 1,375 | 1,122 | |
Deferred tax liabilities: | |||
Property and equipment | 809 | 765 | |
Prepaid expense | 255 | 328 | |
Unrealized gain on securities | 282 | 0 | |
Other | 29 | 29 | |
Total deferred tax liabilities | 1,375 | 1,122 | |
Net deferred tax liability, included in other liabilities | $0 | $0 |
INCOME_TAXES_Narrative_Details
INCOME TAXES (Narrative) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Income Tax Disclosure [Abstract] | ||
Deferred tax assets, valuation allowance | $22,013,000 | $22,542,000 |
Net operating loss carry forward | $43,600,000 |
REGULATORY_RESTRICTIONS_Detail
REGULATORY RESTRICTIONS (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | 31-May-11 | |
Four Oaks Bank & Trust Company (the bBankb) [Member] | |||
Compliance with Regulatory Capital Requirements under Banking Regulations [Line Items] | |||
Dividends paid to the Company by the Bank | $0 | ||
Minimum individual amount of over 90 days past due loans, relationships, or other assets position to be improved | 750,000 | ||
Total Capital (to Risk Weighted Assets), Amount | |||
Total Capital (to Risk Weighted Assets), Amount, Actual | 66,498,000 | 50,601,000 | |
Total Capital (to Risk Weighted Assets), Amount, Minimum for Capital Adequacy Purposes | 36,109,000 | 37,057,000 | |
Total Capital (to Risk Weighted Assets), Amount, Minimum to be Well Capitalized under Prompt Corrective Action Provisions | 45,136,000 | 46,322,000 | |
Tier I Capital (to Risk Weighted Assets), Amount | |||
Tier I Capital (to Risk Weighted Assets), Amount, Actual | 60,810,000 | 44,739,000 | |
Tier I Capital (to Risk Weighted Assets), Amount, Minimum for Capital Adequacy Purposes | 18,054,000 | 18,529,000 | |
Tier I Capital (to Risk Weighted Assets), Amount, Minimum to be Well Capitalized under Prompt Corrective Action Provisions | 27,082,000 | 27,793,000 | |
Tier I Capital (to Average Assets), Amount | |||
Tier I Capital (to Average Assets), Amount, Actual | 60,810,000 | 44,739,000 | |
Tier I Capital (to Average Assets), Amount, Minimum for Capital Adequacy Purposes | 33,844,000 | 32,529,000 | |
Tier I Capital (to Average Assets), Amount, Minimum to be Well Capitalized under Prompt Corrective Action Provisions | $42,305,000 | $40,661,000 | |
Total Capital and Tier I Capital (to Risk Weighted Assets), Ratio | |||
Total Capital (to Risk Weighted Assets), Ratio, Actual | 14.70% | 10.90% | |
Total Capital (to Risk Weighted Assets), Ratio, Minimum for Capital Adequacy Purposes | 8.00% | 8.00% | |
Total Capital (to Risk Weighted Assets), Ratio, Minimum to be Well Capitalized under Prompt Corrective Action Provisions | 10.00% | 10.00% | |
Tier I Capital (to Risk Weighted Assets), Ratio, Actual | 13.50% | 9.70% | |
Tier I Capital (to Risk Weighted Assets), Ratio, Minimum for Capital Adequacy Purposes | 4.00% | 4.00% | |
Tier I Capital (to Risk Weighted Assets), Ratio, Minimum to be Well Capitalized under Prompt Corrective Action Provisions | 6.00% | 6.00% | |
Tier I Capital (to Average Assets), Ratio | |||
Tier I Capital (to Average Assets), Ratio, Actual | 7.20% | 5.50% | |
Tier I Capital (to Average Assets), Ratio, Minimum for Capital Adequacy Purposes | 4.00% | 4.00% | |
Tier I Capital (to Average Assets), Ratio, Minimum to be Well Capitalized under Prompt Corrective Action Provisions | 5.00% | 5.00% | |
Parent Company [Member] | |||
Total Capital and Tier I Capital (to Risk Weighted Assets), Ratio | |||
Total Capital (to Risk Weighted Assets), Ratio, Actual | 15.00% | 10.70% | |
Total Capital (to Risk Weighted Assets), Ratio, Minimum to be Well Capitalized under Prompt Corrective Action Provisions | 10.00% | ||
Tier I Capital (to Risk Weighted Assets), Ratio, Actual | 11.60% | 6.30% | |
Tier I Capital (to Risk Weighted Assets), Ratio, Minimum to be Well Capitalized under Prompt Corrective Action Provisions | 6.00% | ||
Tier I Capital (to Average Assets), Ratio | |||
Tier I Capital (to Average Assets), Ratio, Actual | 6.20% | 3.60% | |
Tier I Capital (to Average Assets), Ratio, Minimum to be Well Capitalized under Prompt Corrective Action Provisions | 5.00% |
COMMITMENTS_AND_CONTINGENCIES_1
COMMITMENTS AND CONTINGENCIES (Details) (USD $) | 12 Months Ended | 0 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | Jan. 08, 2014 | |
Loan Commitments [Line Items] | |||
Loan commitments | $102,284,000 | $74,830,000 | |
Indemnification from third party payment processor clients | 3,872,000 | 0 | |
Consumer Fraud [Member] | |||
Loan Commitments [Line Items] | |||
Settlement amount, civil monetary penalty | 1,000,000 | ||
Settlement amount, civil forfeiture | 200,000 | ||
Legally Binding Commitments [Member] | |||
Loan Commitments [Line Items] | |||
Loan commitments | 89,511,000 | 60,972,000 | |
Commitments to Extend Credit [Member] | |||
Loan Commitments [Line Items] | |||
Loan commitments | 14,182,000 | 7,655,000 | |
Undisbursed Lines of Credit [Member] | |||
Loan Commitments [Line Items] | |||
Loan commitments | 73,888,000 | 52,326,000 | |
Financial Stand-by Letters of Credit [Member] | |||
Loan Commitments [Line Items] | |||
Loan commitments | 238,000 | 798,000 | |
Performance Stand-by Letters of Credit [Member] | |||
Loan Commitments [Line Items] | |||
Loan commitments | 1,203,000 | 193,000 | |
Credit Card Lines [Member] | |||
Loan Commitments [Line Items] | |||
Loan commitments | $12,773,000 | $13,858,000 |
FAIR_VALUE_MEASUREMENTS_Narrat
FAIR VALUE MEASUREMENTS (Narrative) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans held for sale | $2,882 | $0 |
Transfers of loans to loans held for sale | 13,193 | 0 |
Impaired loans | 13,415 | 39,176 |
With an allowance recorded | 2,005 | 7,772 |
Specific valuation allowance allocations | 663 | 1,825 |
With no related allowance recorded | 11,410 | 31,404 |
Valuation adjustment on foreclosed assets | 1,772 | 1,590 |
Foreclosed assets | 3,782 | 8,502 |
Loans Receivable [Member] | Maximum [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Collateral discounts | 50.00% | |
Estimated Fair Value [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impaired loans | 10,400 | 20,100 |
With an allowance recorded | 1,600 | 7,800 |
Specific valuation allowance allocations | 524 | 1,800 |
With no related allowance recorded | 8,800 | 12,300 |
Residential Mortgage [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans held for sale | 335 | |
With an allowance recorded | 192 | 1,427 |
Specific valuation allowance allocations | 61 | 456 |
With no related allowance recorded | 2,030 | 10,948 |
Residential Mortgage [Member] | Maximum [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Collateral discounts | 20.00% | |
Other Loans [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Transfers of loans to loans held for sale | $2,500 |
FAIR_VALUE_MEASUREMENTS_Assets
FAIR VALUE MEASUREMENTS (Assets Measured at Fair Value on Recurring Basis) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | $64,211 | $32,566 |
Taxable Municipal Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 17,078 | 5,933 |
Mortgage-backed Securities GNMA [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 16,264 | 25,477 |
Mortgage-backed Securities FNMA & FHLMC [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 30,858 | |
Equity Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 11 | 131 |
Quoted Prices in Active Markets for Identical Asset (Level 1) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 0 | 70 |
Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 64,211 | 31,471 |
Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 0 | 1,025 |
Total Carrying Amount in the Consolidated Balance Sheet [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 64,211 | 32,566 |
Assets Measured at Fair Value [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 64,211 | 32,566 |
Recurring Basis [Member] | Quoted Prices in Active Markets for Identical Asset (Level 1) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 0 | 70 |
Recurring Basis [Member] | Quoted Prices in Active Markets for Identical Asset (Level 1) [Member] | Taxable Municipal Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 0 | 0 |
Recurring Basis [Member] | Quoted Prices in Active Markets for Identical Asset (Level 1) [Member] | Mortgage-backed Securities GNMA [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 0 | 0 |
Recurring Basis [Member] | Quoted Prices in Active Markets for Identical Asset (Level 1) [Member] | Mortgage-backed Securities FNMA & FHLMC [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 0 | |
Recurring Basis [Member] | Quoted Prices in Active Markets for Identical Asset (Level 1) [Member] | Trust Preferred Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 0 | |
Recurring Basis [Member] | Quoted Prices in Active Markets for Identical Asset (Level 1) [Member] | Equity Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 0 | 70 |
Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 64,211 | 31,471 |
Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | Taxable Municipal Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 17,078 | 5,933 |
Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | Mortgage-backed Securities GNMA [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 16,264 | 25,477 |
Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | Mortgage-backed Securities FNMA & FHLMC [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 30,858 | |
Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | Trust Preferred Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 0 | |
Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | Equity Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 11 | 61 |
Recurring Basis [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 0 | 1,025 |
Recurring Basis [Member] | Significant Unobservable Inputs (Level 3) [Member] | Taxable Municipal Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 0 | 0 |
Recurring Basis [Member] | Significant Unobservable Inputs (Level 3) [Member] | Mortgage-backed Securities GNMA [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 0 | 0 |
Recurring Basis [Member] | Significant Unobservable Inputs (Level 3) [Member] | Mortgage-backed Securities FNMA & FHLMC [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 0 | |
Recurring Basis [Member] | Significant Unobservable Inputs (Level 3) [Member] | Trust Preferred Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 1,025 | |
Recurring Basis [Member] | Significant Unobservable Inputs (Level 3) [Member] | Equity Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 0 | 0 |
Recurring Basis [Member] | Total Carrying Amount in the Consolidated Balance Sheet [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 64,211 | 32,566 |
Recurring Basis [Member] | Total Carrying Amount in the Consolidated Balance Sheet [Member] | Taxable Municipal Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 17,078 | 5,933 |
Recurring Basis [Member] | Total Carrying Amount in the Consolidated Balance Sheet [Member] | Mortgage-backed Securities GNMA [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 16,264 | 25,477 |
Recurring Basis [Member] | Total Carrying Amount in the Consolidated Balance Sheet [Member] | Mortgage-backed Securities FNMA & FHLMC [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 30,858 | |
Recurring Basis [Member] | Total Carrying Amount in the Consolidated Balance Sheet [Member] | Trust Preferred Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 1,025 | |
Recurring Basis [Member] | Total Carrying Amount in the Consolidated Balance Sheet [Member] | Equity Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 11 | 131 |
Recurring Basis [Member] | Assets Measured at Fair Value [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 64,211 | 32,566 |
Recurring Basis [Member] | Assets Measured at Fair Value [Member] | Taxable Municipal Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 17,078 | 5,933 |
Recurring Basis [Member] | Assets Measured at Fair Value [Member] | Mortgage-backed Securities GNMA [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 16,264 | 25,477 |
Recurring Basis [Member] | Assets Measured at Fair Value [Member] | Mortgage-backed Securities FNMA & FHLMC [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 30,858 | |
Recurring Basis [Member] | Assets Measured at Fair Value [Member] | Trust Preferred Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | 1,025 | |
Recurring Basis [Member] | Assets Measured at Fair Value [Member] | Equity Securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | $11 | $131 |
FAIR_VALUE_MEASUREMENTS_Level_
FAIR VALUE MEASUREMENTS (Level 3 Assets Measured at Fair Value on Recurring Basis) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Level 3 Assets Measured at Fair Value on a Recurring Basis [Roll Forward] | ||
Beginning Balance | $1,025 | $1,006 |
Total realized and unrealized gains or (losses) included in earnings | 250 | 0 |
Total realized and unrealized gains or (losses) included in other comprehensive income | 150 | 19 |
Purchases, issuances and settlements | -1,425 | 0 |
Ending Balance | $0 | $1,025 |
FAIR_VALUE_MEASUREMENTS_Assets1
FAIR VALUE MEASUREMENTS (Assets Measured at Fair Value on Nonrecurring Basis) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Quoted Prices in Active Markets for Identical Asset (Level 1) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans held for sale | $0 | |
Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans held for sale | 2,882 | |
Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans held for sale | 0 | |
Total Carrying Amount in the Consolidated Balance Sheet [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans held for sale | 2,882 | |
Assets Measured at Fair Value [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans held for sale | 2,882 | |
Nonrecurring Basis [Member] | Quoted Prices in Active Markets for Identical Asset (Level 1) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans held for sale | 0 | |
Impaired loans | 0 | 0 |
Foreclosed assets | 0 | 0 |
Nonrecurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans held for sale | 2,882 | |
Impaired loans | 0 | 0 |
Foreclosed assets | 0 | 0 |
Nonrecurring Basis [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans held for sale | 0 | |
Impaired loans | 9,855 | 18,215 |
Foreclosed assets | 3,782 | 8,502 |
Nonrecurring Basis [Member] | Total Carrying Amount in the Consolidated Balance Sheet [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans held for sale | 2,882 | |
Impaired loans | 9,855 | 18,215 |
Foreclosed assets | 3,782 | 8,502 |
Nonrecurring Basis [Member] | Assets Measured at Fair Value [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans held for sale | 2,882 | |
Impaired loans | 9,855 | 18,215 |
Foreclosed assets | $3,782 | $8,502 |
FAIR_VALUE_MEASUREMENTS_Level_1
FAIR VALUE MEASUREMENTS (Level 3 Nonrecurring and Recurring Fair Value Measurement) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Impaired loans | 13,415 | $39,176 |
Foreclosed assets | 3,782 | 8,502 |
Significant Unobservable Inputs (Level 3) [Member] | Nonrecurring Measurements [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Impaired loans | 9,855 | |
Foreclosed assets | 3,782 | |
Significant Unobservable Inputs (Level 3) [Member] | Nonrecurring Measurements [Member] | Minimum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Collateral discounts | 9.00% | |
Discounted appraisals | 10.00% | |
Significant Unobservable Inputs (Level 3) [Member] | Nonrecurring Measurements [Member] | Maximum [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Collateral discounts | 50.00% | |
Discounted appraisals | 30.00% |
FAIR_VALUE_MEASUREMENTS_Range_
FAIR VALUE MEASUREMENTS (Range of Collateral Discounts) (Details) | 12 Months Ended |
Dec. 31, 2014 | |
Commercial Construction and Land Development [Member] | Minimum [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Collateral discounts | 10.50% |
Commercial Construction and Land Development [Member] | Maximum [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Collateral discounts | 40.00% |
Commercial Real Estate Other Member] | Minimum [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Collateral discounts | 12.50% |
Commercial Real Estate Other Member] | Maximum [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Collateral discounts | 50.00% |
Residential Construction [Member] | Minimum [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Collateral discounts | 9.00% |
Residential Construction [Member] | Maximum [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Collateral discounts | 30.00% |
Residential Mortgage [Member] | Minimum [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Collateral discounts | 9.00% |
Residential Mortgage [Member] | Maximum [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Collateral discounts | 20.00% |
All Other Segments [Member] | Minimum [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Collateral discounts | 9.00% |
All Other Segments [Member] | Maximum [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Collateral discounts | 20.00% |
FAIR_VALUE_MEASUREMENTS_Fair_V
FAIR VALUE MEASUREMENTS (Fair Value of Financial Instruments) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Financial assets: | ||
Certificates of deposit | 27,784 | $31,850 |
Available for sale securities | 64,211 | 32,566 |
Securities held to maturity | 82,242 | 95,831 |
Carrying Value [Member] | ||
Financial assets: | ||
Cash and cash equivalents | 158,527 | 128,629 |
Certificates of deposit | 27,784 | 31,850 |
Available for sale securities | 64,211 | 32,566 |
Securities held to maturity | 81,583 | 98,013 |
Loans held for sale | 2,882 | |
Loans, net | 442,879 | 481,122 |
FHLB stock | 4,788 | 6,076 |
Accrued interest receivable | 1,627 | 1,576 |
Financial liabilities: | ||
Deposits | 661,185 | 657,620 |
Subordinated debentures and subordinated promissory notes | 24,372 | 24,372 |
Borrowings | 90,000 | 112,000 |
Accrued interest payable | 1,704 | 1,642 |
Estimated Fair Value [Member] | ||
Financial assets: | ||
Cash and cash equivalents | 158,527 | 128,629 |
Certificates of deposit | 27,784 | 31,850 |
Available for sale securities | 64,211 | 32,566 |
Securities held to maturity | 82,242 | 95,831 |
Loans held for sale | 2,882 | |
Loans, net | 422,906 | 458,254 |
FHLB stock | 4,788 | 6,076 |
Accrued interest receivable | 1,627 | 1,576 |
Financial liabilities: | ||
Deposits | 663,000 | 659,733 |
Subordinated debentures and subordinated promissory notes | 25,671 | 24,369 |
Borrowings | 95,573 | 121,519 |
Accrued interest payable | 1,704 | 1,642 |
Level 1 [Member] | ||
Financial assets: | ||
Cash and cash equivalents | 158,527 | 128,629 |
Certificates of deposit | 0 | 0 |
Available for sale securities | 0 | 70 |
Securities held to maturity | 0 | 0 |
Loans held for sale | 0 | |
Loans, net | 0 | 0 |
FHLB stock | 0 | 0 |
Accrued interest receivable | 0 | 0 |
Financial liabilities: | ||
Deposits | 0 | 0 |
Subordinated debentures and subordinated promissory notes | 0 | 0 |
Borrowings | 0 | 0 |
Accrued interest payable | 0 | 0 |
Level 2 [Member] | ||
Financial assets: | ||
Cash and cash equivalents | 0 | 0 |
Certificates of deposit | 27,784 | 31,850 |
Available for sale securities | 64,211 | 31,471 |
Securities held to maturity | 82,242 | 95,831 |
Loans held for sale | 2,882 | |
Loans, net | 0 | 0 |
FHLB stock | 4,788 | 6,076 |
Accrued interest receivable | 1,627 | 1,576 |
Financial liabilities: | ||
Deposits | 663,000 | 659,733 |
Subordinated debentures and subordinated promissory notes | 0 | 0 |
Borrowings | 95,573 | 121,519 |
Accrued interest payable | 1,704 | 1,642 |
Level 3 [Member] | ||
Financial assets: | ||
Cash and cash equivalents | 0 | 0 |
Certificates of deposit | 0 | 0 |
Available for sale securities | 0 | 1,025 |
Securities held to maturity | 0 | 0 |
Loans held for sale | 0 | |
Loans, net | 422,906 | 458,254 |
FHLB stock | 0 | 0 |
Accrued interest receivable | 0 | 0 |
Financial liabilities: | ||
Deposits | 0 | 0 |
Subordinated debentures and subordinated promissory notes | 25,671 | 24,369 |
Borrowings | 0 | 0 |
Accrued interest payable | 0 | $0 |
Loans Receivable [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Adjustment for current liquidity and market discount, rate | 5.00% |
STOCK_OPTION_PLAN_Narrative_De
STOCK OPTION PLAN (Narrative) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Common stock reserved for future issuance | 214,845 | |
Weighted average exercise price, exercisable options (in usd per share) | $6.92 | |
Unrecognized compensation cost, non-vested awards | $42,016 | $39,908 |
Weighted average fair value of options granted (in usd per share) | $1.03 | $0.69 |
Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Common stock reserved for future issuance | 1,542,773 | |
Award vesting rights, percentage | 100.00% | |
Minimum [Member] | Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting period | 1 year | |
Maximum [Member] | Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting period | 2 years | 2 years |
STOCK_OPTION_PLAN_Option_Activ
STOCK OPTION PLAN (Option Activity Rollforward) (Details) (USD $) | 12 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Options, Outstanding [Roll Forward] | ||
Outstanding at beginning of period (in shares) | 301,705 | |
Issued (in shares) | 54,375 | |
Exercised (in shares) | 0 | |
Forfeited (in shares) | 29,723 | |
Expired (in shares) | 47,775 | |
Outstanding at end of period (in shares) | 278,582 | 301,705 |
Options, Outstanding, Weighted Average Exercise Price [Roll Forward] | ||
Outstanding at beginning of period (in usd per share) | $5.99 | |
Granted (in usd per share) | $1.70 | |
Exercised (in usd per share) | $0 | |
Forfeited (in usd per share) | $4.46 | |
Expired (in usd per share) | $8.64 | |
Outstanding at end of period (in usd per share) | $4.86 | $5.99 |
Options, Additional Disclosures | ||
Weighted-Average Remaining Contractual Term | 2 years 1 month 24 days | |
Aggregate Intrinsic Value | $18,935 | |
Options, Exercisable (in shares) | 174,026 | |
Options, Exercisable (in usd per share) | $6.92 | |
Options, Exercisable, Weighted Average Remaining Contractual Term | 1 year 2 months 23 days | |
Options, Exercisable, Intrinsic Value | $0 |
STOCK_OPTION_PLAN_Nonvested_Op
STOCK OPTION PLAN (Non-vested Options) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Options, Nonvested, Number of Shares [Roll Forward] [Roll Forward] | ||
Non-vested - beginning of period (in shares) | 111,656 | |
Granted (in shares) | 53,350 | |
Vested (in shares) | 4,825 | |
Forfeited/Expired (in shares) | 55,625 | |
Non-vested - end of period (in shares) | 104,556 | 111,656 |
Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward] | ||
Non-vested - beginning of period (in usd per share) | $0.78 | |
Granted (in usd per share) | $1.03 | $0.69 |
Vested (in usd per share) | $0.69 | |
Forfeited/Expired (in usd per share) | $0.87 | |
Non-vested - end of period (in usd per share) | $0.86 | $0.78 |
STOCK_OPTION_PLAN_Options_by_E
STOCK OPTION PLAN (Options by Exercise Price) (Details) (USD $) | 12 Months Ended |
Dec. 31, 2014 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Number Outstanding (in shares) | 278,582 |
Contractual Life (Years) | 2 years 1 month 24 days |
Number Exercisable (in shares) | 174,026 |
1.15 - 1.69 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise price range, lower range limit (in usd per share) | 1.15 |
Exercise price range, upper range limit (in usd per share) | 1.69 |
Number Outstanding (in shares) | 51,175 |
Contractual Life (Years) | 3 years 2 months 8 days |
Number Exercisable (in shares) | 0 |
1.70 - 2.99 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise price range, lower range limit (in usd per share) | 1.7 |
Exercise price range, upper range limit (in usd per share) | 2.99 |
Number Outstanding (in shares) | 101,975 |
Contractual Life (Years) | 3 years 2 months 12 days |
Number Exercisable (in shares) | 48,623 |
3.00 - 5.49 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise price range, lower range limit (in usd per share) | 3 |
Exercise price range, upper range limit (in usd per share) | 5.49 |
Number Outstanding (in shares) | 46,175 |
Contractual Life (Years) | 1 year 1 month 27 days |
Number Exercisable (in shares) | 46,173 |
5.50 - 10.91 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise price range, lower range limit (in usd per share) | 5.5 |
Exercise price range, upper range limit (in usd per share) | 10.91 |
Number Outstanding (in shares) | 46,175 |
Contractual Life (Years) | 1 month 24 days |
Number Exercisable (in shares) | 46,151 |
10.92 - 40.78 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise price range, lower range limit (in usd per share) | 10.92 |
Exercise price range, upper range limit (in usd per share) | 40.78 |
Number Outstanding (in shares) | 20,777 |
Contractual Life (Years) | 6 months 18 days |
Number Exercisable (in shares) | 20,774 |
40.79 [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise price range, lower range limit (in usd per share) | 40.79 |
Exercise price range, upper range limit (in usd per share) | 40.79 |
Number Outstanding (in shares) | 12,305 |
Contractual Life (Years) | 3 years 0 months 25 days |
Number Exercisable (in shares) | 12,305 |
STOCK_OPTION_PLAN_Valuation_As
STOCK OPTION PLAN (Valuation Assumptions) (Details) (Stock Options [Member]) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Stock Options [Member] | ||
Valuation Assumptions [Line Items] | ||
Dividend yield | 0.00% | 0.00% |
Expected volatility | 73.31% | 73.30% |
Risk free interest rate | 1.57% | 0.90% |
Expected life | 5 years | 5 years |
OTHER_EMPLOYEE_BENEFITS_Detail
OTHER EMPLOYEE BENEFITS (Details) (USD $) | 0 Months Ended | 12 Months Ended | 311 Months Ended | |
Apr. 08, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | |
Defined Benefit Plan Disclosure [Line Items] | ||||
Maximum annual contribution per employee, amount | $17,500 | |||
Maximum annual contribution per employee, percent | 25.00% | |||
Employer matching contribution, percent | 6.00% | |||
Defined contribution plan, expenses | 76,000 | 77,000 | ||
ESOP, vesting percentage | 100.00% | |||
ESOP, distribution percentage | 100.00% | |||
Common stock reserved for future issuance | 214,845 | 214,845 | ||
Sick Leave Plan [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Maximum contractual term | 60 days | |||
Requisite service period | 10 years | |||
Retirement age | 55 years | |||
Accrued liability, sick leave | 562,000 | 521,000 | 562,000 | |
Deferred compensation expenses under the plan | 82,000 | 41,000 | ||
Cash benefits paid to retiring employees | 40,000 | 54,000 | 40,000 | |
Employee Stock Purchase and Bonus Plan [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Maximum employee subscription rate | 5.00% | 5.00% | ||
Maximum employee subscription amount | 1,000 | 1,000 | ||
Employer matching percent | 50.00% | |||
Employer matching amount | 500 | 500 | ||
Common stock reserved for future issuance | 118,000 | 118,000 | ||
Shares purchased | 0 | 76,000 | 401,000 | |
President [Member] | SERP [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Accrued liability | 477,000 | 481,000 | 477,000 | |
Retirement plan expense | $0 | $61,000 |
LEASES_Details
LEASES (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
branch_offices | ||
Leases [Abstract] | ||
Number of branch facilities | 6 | |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | ||
2015 | $350 | |
2016 | 284 | |
2017 | 232 | |
2018 | 185 | |
2019 | 178 | |
2020 and beyond | 449 | |
Future minimum lease payments | 1,678 | |
Total rental expense | $327 | $306 |
PARENT_COMPANY_FINANCIAL_INFOR2
PARENT COMPANY FINANCIAL INFORMATION (Condensed Balance Sheets) (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | |||
Assets: | |||
Cash and cash equivalents | $158,527 | $128,629 | $183,150 |
Investment securities available-for-sale, at fair value | 64,211 | 32,566 | |
Other assets | 6,248 | 6,261 | |
TOTAL ASSETS | 820,796 | 821,546 | |
Liabilities and Shareholders' Equity: | |||
Other liabilities | 2,806 | 4,289 | |
Subordinated debentures | 12,372 | 12,372 | |
Subordinated promissory notes | 12,000 | 12,000 | |
Shareholders' equity | 40,729 | 21,623 | 22,676 |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | 820,796 | 821,546 | |
Parent Company [Member] | |||
Assets: | |||
Cash and cash equivalents | 3,958 | 456 | 784 |
Equity investment in subsidiaries | 61,937 | 44,925 | |
Investment securities available-for-sale, at fair value | 11 | 1,156 | |
Other assets | 131 | 195 | |
TOTAL ASSETS | 66,037 | 46,732 | |
Liabilities and Shareholders' Equity: | |||
Other liabilities | 936 | 737 | |
Subordinated debentures | 12,372 | 12,372 | |
Subordinated promissory notes | 12,000 | 12,000 | |
Shareholders' equity | 40,729 | 21,623 | |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $66,037 | $46,732 |
PARENT_COMPANY_FINANCIAL_INFOR3
PARENT COMPANY FINANCIAL INFORMATION (Condensed Statements of Operations) (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Condensed Income Statements, Captions [Line Items] | ||
Gain on sale of investments, available for sale | $265,000 | $462,000 |
Recovery of impairment loss on investment securities available-for-sale | 0 | |
Net loss | -4,189,000 | -350,000 |
Parent Company [Member] | ||
Condensed Income Statements, Captions [Line Items] | ||
Equity in undistributed (loss) income of subsidiaries | -3,128,000 | 899,000 |
Interest income | 5,000 | 2,000 |
Gain on sale of investments, available for sale | 109,000 | 0 |
Recovery of impairment loss on investment securities available-for-sale | 189,000 | 0 |
Other income | 20,000 | 87,000 |
Other expenses | -1,384,000 | -1,338,000 |
Net loss | ($4,189,000) | ($350,000) |
PARENT_COMPANY_FINANCIAL_INFOR4
PARENT COMPANY FINANCIAL INFORMATION (Condensed Statements of Cash Flows) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Operating activities: | ||
Net income (loss) | ($4,189) | ($350) |
Gain on sale of investments | -265 | -462 |
Increase in other assets | -153 | 2,274 |
Increase in other liabilities | -1,483 | -569 |
Net cash provided by operating activities | 12,079 | 5,239 |
Investing activities: | ||
Sales and maturities of securities | 22,737 | 20,873 |
Net cash (used in) provided by investing activities | 14,012 | -75,109 |
Financing activities: | ||
Proceeds from issuance of common stock | 22,242 | 220 |
Net cash provided by financing activities | 3,807 | 15,349 |
Change in cash and cash equivalents | 29,898 | -54,521 |
Cash and cash equivalents at beginning of period | 128,629 | 183,150 |
Cash and cash equivalents at end of period | 158,527 | 128,629 |
Parent Company [Member] | ||
Operating activities: | ||
Net income (loss) | -4,189 | -350 |
Equity in undistributed loss of subsidiaries | 3,128 | -899 |
Gain on sale of investments | -298 | 0 |
Increase in other assets | 16 | 427 |
Increase in other liabilities | 199 | 203 |
Net cash provided by operating activities | -1,144 | -619 |
Investing activities: | ||
Investment in subsidiaries | -19,157 | 0 |
Sales and maturities of securities | 1,560 | 72 |
Net cash (used in) provided by investing activities | -17,597 | 72 |
Financing activities: | ||
Proceeds from issuance of common stock | 22,243 | 219 |
Net cash provided by financing activities | 22,243 | 219 |
Change in cash and cash equivalents | 3,502 | -328 |
Cash and cash equivalents at beginning of period | 456 | 784 |
Cash and cash equivalents at end of period | $3,958 | $456 |
SECURITIES_PURCHASE_AGREEMENT_
SECURITIES PURCHASE AGREEMENT (Details) (USD $) | 12 Months Ended | 0 Months Ended | ||||
Dec. 31, 2014 | Dec. 31, 2013 | Aug. 15, 2014 | Mar. 27, 2014 | Mar. 24, 2014 | Jun. 18, 2014 | |
Class of Stock [Line Items] | ||||||
Rights of offering, maximum amount | $26,600,000 | |||||
Rights of offering, number of shares called by each non-transferable right | 3 | |||||
Rights of offering, subscription price per share (in usd per share) | $1 | |||||
Issuance of common stock (in shares) | 24,000,000 | |||||
Estimated aggregate gross proceeds from offerings | 22,242,000 | 220,000 | ||||
Exercise of Basic Subscription Privilege [Member] | ||||||
Class of Stock [Line Items] | ||||||
Issuance of common stock (in shares) | 9,248,464 | |||||
Exercise of Oversubscription Privilege [Member] | ||||||
Class of Stock [Line Items] | ||||||
Issuance of common stock (in shares) | 1,376,536 | |||||
Standby Investor [Member] | ||||||
Class of Stock [Line Items] | ||||||
Number of shares sold at the initial sale | 875,000 | |||||
Percentage of ownership owned by investor | 25.00% | |||||
Standby Investor [Member] | Standby Offering [Member] | ||||||
Class of Stock [Line Items] | ||||||
Sales price (in usd per share) | 1 | |||||
Number of common stock shares | 10,000,000 | |||||
Number of additional common stock shares for purchase | 12,500,000 | 6,000,000 | ||||
Standby Investor [Member] | Standby Offering [Member] | Maximum [Member] | ||||||
Class of Stock [Line Items] | ||||||
Maximum percentage of shares that can be purchased | 49.99% | |||||
Standby Investor [Member] | Exercise of Basic Subscription Privilege [Member] | ||||||
Class of Stock [Line Items] | ||||||
Issuance of common stock (in shares) | 2,625,000 | |||||
Common Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Sales price (in usd per share) | 1 | |||||
Issuance of common stock (in shares) | 24,054,670 | 162,272 | 24,000,000 | |||
Estimated aggregate gross proceeds from offerings | $24,054,000 | $163,000 | 24,000,000 |